Kenmare Resources plc
("Kenmare" or the "Company")
25 November 2022
Kenmare Resources plc (LSE:KMR, ISE:KMR), one of the leading global producers of titanium minerals and zircon, which operates the Moma Titanium Minerals Mine (the "Mine" or "Moma") in northern Mozambique, announces an update to its 2022 guidance.
Statement from Michael Carvill, Managing Director:
"Production of ilmenite, our primary product, was strong in October 2022 and we maintained the 1.2 million tonne per annum run rate we achieved in Q3. However, a recent issue in the electricity transmission grid has created unplanned power outages. Kenmare is actively working with the state electricity provider, Electricidade de Moçambique, to identify and rectify the problem but the outages have resulted in lower production, and consequently, we are revising our ilmenite guidance.
Q4 is expected to be our strongest quarter of shipments, which will not be impacted by lower production, and Q4 prices remain strong."
Kenmare informed the market in its Q3 2022 Production Report, dated 13 October 2022, that it expected production to be at or around the bottom of the Company's 2022 guidance ranges. During October 2022, Kenmare achieved an annualised run rate of 1.2 million tonnes per annum of ilmenite production, in line with original guidance and driven by the Company's robust performance in Q3 2022. However, more recently, Heavy Mineral Concentrate ("HMC") production weakened due to unplanned power outages.
Consequently, 2022 guidance for production of ilmenite and rutile is updated as follows:
- Concentrates include secondary zircon and mineral sands concentrate.
The lower end of the revised guidance ranges assumes a continuation of recent power disruptions until the end of the year. However, Kenmare is working with the state electricity provider, Electricidade de Moçambique, to identify and rectify the issues as a matter of urgency.
Production guidance for primary zircon and concentrates is unchanged due to higher zircon content in the HMC mined and stronger recoveries.
Q4 2022 is anticipated to be the strongest quarter of the year for shipments, due to seasonally favourable weather conditions and unrestricted shipping capacity.
Total cash operating costs are anticipated to be very slightly above the top end of 2022 guidance ($190-210 million), due primarily to higher fuel prices. Cash operating costs per tonne will be a function of lower production volumes and higher operating costs.
Kenmare expects to announce its Q4 and Full Year 2022 Production Report, which will include 2023 guidance, in mid-January 2023.
For further information, please contact:
Kenmare Resources plc
Jeremy Dibb / Katharine Sutton
Tel: +353 1 671 0411
Mob: +353 87 943 0367 / +353 87 663 0875
Murray (PR advisor)
Tel: +353 1 498 0300
Mob: +353 86 609 0221
About Kenmare Resources
Kenmare Resources plc is one of the world's largest producers of mineral sands products. Listed on the London Stock Exchange and the Euronext Dublin, Kenmare operates the Moma Titanium Minerals Mine in Mozambique. Moma's production accounts for approximately 8% of global titanium feedstocks and the Company supplies to customers operating in more than 15 countries. Kenmare produces raw materials that are ultimately consumed in everyday quality-of life items such as paints, plastics and ceramic tiles.
All monetary amounts refer to United States dollars unless otherwise indicated.
Forward Looking Statements
This announcement contains some forward-looking statements that represent Kenmare's expectations for its business, based on current expectations about future events, which by their nature involve risks and uncertainties. Kenmare believes that its expectations and assumptions with respect to these forward-looking statements are reasonable. However, because they involve risk and uncertainty, which are in some cases beyond Kenmare's control, actual results or performance may differ materially from those expressed or implied by such forward-looking information.