The Metorex solvent
extraction plant at the
Sable processing
facility in Zambia
 
Johannesburg, South Africa —MININGREVIEW.COM — 22 August 2008 – Metorex Limited – an independent mid-tier mining company currently active in base metals, industrial minerals, and gold – has experienced an impressive operating year, and is poised for significant further growth over the next three to four years.

Releasing its results for the financial year to 30 June 2008, the group revealed that it had continued its earnings growth trend, which was largely a result of a 36% increase in copper sales following significant volume growth. All commodity prices achieved had improved from the previous year, with the increase in the gold price being the most notable. Mining profit had increased by 86% to R921 million. This was approximately 50% attributable to the rise in its copper and cobalt sales volumes. Headline earnings per share increased by 19% to 132 cents, after a dilution of 11 cents per share following the issue of additional shares for the acquisition of the Copper Resources Corporation development, and by a further 9 cents per share, including a one-off deferred tax change of 6 cents per share, relating to the change in the Zambian Taxation Legislation.

All operations contributed to the 43% improvement in the group’s turnover. The realisation costs increase of 39% was mainly attributable to the high cost of moving, and associated border clearing costs, of copper/cobalt concentrate from the DRC to Sable in Zambia.

The release added that operating cost structure had increased by 26% to R1.13 billion. This was related to the increase in production volumes, general inflation pressures, the Kwacha/Dollar exchange rate and exponential price increases in fuel, steel and reagents.

The Group’s balance sheet has been enhanced with the equity attributable to its shareholders increasing by R1.5 billion to R3.4 billion. Cash generated by operations increased by 44% to R916 million for the year.

Looking to the future, the Group’s organic growth profile envisages its copper and cobalt production increasing to between 125 000 and 140 000 to tpa and 6 000 to 8 000 tpa respectively by the 2012 financial year. These growth projects will require estimated capital of US$300 million (R2.25 billion) to US$400 million (R3 billion), which would be applied to the Kinsenda Mine development and the Musonoi project, both in the DRC.

Metorex CEO Charles Needham commented: “The group’s performance for the year and its development activities have been most satisfactory, and it is poised for significant growth over the next three to four years with its pipeline of development projects.”