Base business going well

WITH managing director Tim Carstens said to be “unexpectedly” travelling for business reasons, Base Resources has reported a strong headline quarterly performance while forecasting broadly similar output in the year ahead – albeit slightly less ilmenite.
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Michael Quinn

The forecast ilmenite production of 400,000-430,000t compares to nearly 470,000t in the just completed 2016-17 period, and is a function of the project being optimised as per the Kwale Phase 2 initiative at its operation in Kenya.

In a conference call reporting the June quarter performance and hosted by CFO Kevin Balloch, Base noted the ilmenite price of US$180 per tonne was incentivising low grade product onto the market, in particular out of Vietnam.

Base is continuing to make generally positive noises about the mineral sand sector and outlook in the sector, with Ballock saying prices are “really pushing ahead”.

Base recorded a record revenue to costs ratio in the quarter of 2.9, compared to its previous record of 2.5 and versus industry average last year estimated at about 1.1.

Still, Base did report shipments of rutile equating to nearly one-third of its annual total in the quarter.

The current quarter will see one shipment of rutile (versus three in the June quarter), and one less ilmenite shipment.

Base’s net debt was reduced by $24 million to $98.5 million.

Meanwhile no information on Carstens absence was provided.

Any speculation about potential reasons might revolve around legislation changes in Tanzania that could impact the company’s exploration, or the stock standard M&A suggestion.

Shares in Base were up 2% to A26c in morning trade, capitalising the mineral sands producer at $193 million.