In This Article:
LONDON, UK / ACCESSWIRE / January 31, 2023 / Ecora Resources PLC (LSE:ECOR)(TSX:ECOR) issues the following trading update for the period 1 October 2022 to 31 December 2022. This update is released ahead of the Group's audited full year results on 29 March 2023.
Highlights:
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Record FY22 portfolio contribution of $143.1 million up 67% on FY21 ($85.6 million) as the portfolio benefited from stronger commodity prices for the majority of the year.
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Q4 portfolio contribution of $17.8 million, a 48% reduction compared to Q3 22 ($34.1 million), driven by lower saleable production from the Kestrel mine due to reduced mining rates and operational constraints that limited throughput volumes at the handling and preparation plant.
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Construction commenced on the West Musgrave copper nickel project with production forecast by OZ Minerals to start in H2 25.
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BHP reached an agreement to acquire 100% of the shares in OZ Minerals (subject to various conditions) in a transaction that will see BHP become operator of the West Musgrave development.
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Capstone Copper published the Mantoverde-Santo Domingo District Integration Plan, detailing the path towards a world class mining district in the Atacama region of Chile.
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Net debt at 31 December was $35 million with the balance sheet flexibility to pursue further growth.
Portfolio Outlook
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Copper, coking coal, nickel, vanadium and uranium prices have started the year strongly, whilst cobalt prices have softened YTD.
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Kestrel saleable volumes produced within the Group's private royalty area in 2023 are forecast to be approximately half those achieved in 2022, with volumes primarily weighted towards Q1 and Q4.
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Voisey's Bay stream expected to generate 13-15 deliveries of cobalt in 2023 (each delivery is 20 tonnes), compared to 19 received in 2022, due to the transition from the open pit to underground mining operations.
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The Group is currently in discussions with the operator of its EVBC royalty following recent margin pressure, and it is likely in the short term that a portion of cash royalties, including H2 22, may be deferred until a later date.
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Production volumes at the Group's other royalty assets for 2023 are expected to be broadly in line with 2022 levels.
| Portfolio contribution - Unaudited(1) | Q4 2022 | Q3 2022 | 2022 | 2021 | ||
| $m | QoQ | $m | $m | YoY | $m | |
| Kestrel | 9.8 | (65%) | 28.0 | 107.2 | 123% | 48.1 |
| Voisey's Bay | 3.3 | 106% | 1.6 | 18.8 | 14% | 16.5 |
| Mantos Blancos | 1.6 | 23% | 1.3 | 6.0 | 5% | 5.7 |
| Maracás Menchen | 0.8 | (11%) | 0.9 | 3.6 | 9% | 3.3 |
| Four Mile | 0.2 | 100% | 0.1 | 1.0 | 233% | 0.3 |
| Carlotta | 0.2 | n/a | n/a | 0.2 | n/a | n/a |
| Narrabri (disposed of on 31 Dec 2021) | n/a | n/a | n/a | n/a | n/a | 3.4 |
| Royalty and stream income | 15.9 | (50%) | 31.9 | 136.8 | 77% | 77.3 |
| Dividends - LIORC & Flowstream | 0.6 | (33%) | 0.9 | 2.9 | (48%) | 5.6 |
| Interest - McClean Lake | 0.5 | - | 0.5 | 2.1 | (12%) | 2.4 |
| Royalty and stream related revenue | 17.0 | (49%) | 33.3 | 141.8 | 66% | 85.3 |
| EVBC(2) (3) | 0.6 | (25%) | 0.8 | 2.7 | (10%) | 3.0 |
| Principal repayment - McClean Lake | 1.0 | 150% | 0.4 | 2.9 | 123% | 1.3 |
| Less: | ||||||
| Metal streams cost of sales | (0.8) | (100%) | (0.4) | (4.3) | (8%) | (4.0) |
| Total portfolio contribution | 17.8 | (48%) | 34.1 | 143.1 | 67% | 85.6 |
(1)The portfolio contribution above is unaudited and based on narrow midpoint range, therefore, the actual number reported in the forthcoming annual report may be slightly higher or lower.