In This Article:
Release Date: May 08, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Gruvaktiebolaget Viscaria (STU:5KP) reported a significant increase in mineral resources, with a 25% increase in just one year due to an intense exploration program.
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The company has successfully secured its first mineral reserve and increased the total tonnage for the mineral resource to 108 million tons.
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The average copper grade of the deposit has increased to 0.9%, which is above the global average of 0.55%.
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The feasibility study indicates a robust financial outlook with a pre-tax IRR of 20% and a post-tax IRR of 17%.
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The company is on track to start copper concentrate shipments by 2027, with a projected initial life of mine of 17 years and plans for further expansion.
Negative Points
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The company reported a net profit loss of 18 million SEK for Q1 2025, indicating ongoing financial challenges.
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There is a significant funding requirement of approximately 5.4 billion SEK on an unlevered basis to start or reopen the mine.
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The feasibility study highlights a cash cost of $3,700 per ton, which could be a concern if copper prices fluctuate unfavorably.
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The company faces logistical challenges in mining, as 99.1% of the material is waste, requiring detailed planning and execution.
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There are inherent uncertainties in the depletion model for the A zone due to historical production, which could impact future resource estimates.
Q & A Highlights
Q: How do you rate the NPV of 4.4 billion and a 17-year life of mine? A: CEO Jurgen Olsson stated that they are very satisfied with the NPV, emphasizing that it is just for the initial life of the mine. He highlighted the rapid growth of the deposit and the potential value beyond the current NPV.
Q: Are you satisfied with the copper grade of 0.9%? A: CEO Jurgen Olsson expressed satisfaction with the 0.9% copper grade, noting it is above the global average of 0.55%. He emphasized the importance of considering their specific mining conditions and the benefits of existing infrastructure, which allows for faster and more cost-effective access to high-grade deposits.
Q: Can you elaborate on how you plan to increase the resources? A: Ross Armstrong, Head of Geology, explained that recent exploration has added significant tonnage with higher grades, reflecting a better geological understanding. He emphasized the importance of converting resources to higher categories and the role of underground drilling in achieving this.