Mwana Africa PLC is a pan-African, multi-commodity resources company focused on the production, development and exploration of gold, nickel, copper and diamonds.
Mwana Africa chief says group will ‘emerge stronger’
Mwana Africa (LON:MWA) will emerge as a stronger mining group in the coming financial year, according to chief executive Kalaa Mpinga.
The company has launched a cost cutting programme at both corporate and project levels in response to weakening commodity prices, which have squeezed cash flows and damaged sentiment towards junior miners.
In Mwana’s results, for the twelve months to March 31, group revenue was up 34% to US$109.2mln.
Gold sales from the Freda Rebecca mine, in Zimbabwe, totalled 65,350 ounces and average cash costs reduced 13.6% in the year to US$897 per ounce.
However, a US$43.7mln impairment to the BNC project, due to low Nickel prices, meant the company made a loss of US$43.5mln.
It spent US$15.3mln on exploration during the year and raised US$32.4mln of new capital. At the end of the period it had US$15.2mln of cash.
Operationally there were a number of achievements, including the significant progress made with the Zani Kodo gold project, which has grown to have 2.6mln ounces.
Mwana chief Kalaa Mpinga said: "A considerable amount has been achieved by the Mwana Group over the course of the past financial year including increasing the production rate at Freda Rebecca by 37% to over 65,000oz, expanding the gold resource at Zani-Kodo to over 2.6Moz, securing an established partner in the copper industry to provide exploration funding for SEMHKAT, and successfully concluding the recapitalisation and restructuring of BNC, which in turn led to the restart of the Trojan Nickel Mine and, post period, sale of first concentrate to our off-take partner, Glencore Xstrata.
"Whilst we have, as a result of a steep decline in the Nickel price, decided to impair BNC in our accounts this year, current reviews of BNC's mine plan may result in some reversal of this impairment in the future.
“Our results show a profit before impairment of US$0.5m, which is the first since 2007 and a notable achievement by the company.
"Post the financial year end our share price has suffered from a combination of weakening commodity prices, which have negatively impacted our cash flows at group level, and a decline in general market sentiment to junior miners.
“In response to these challenges we have announced a cost cutting exercise at corporate and project levels; this, together with securing necessary funding and the underlying quality of our projects, will see Mwana emerging as a stronger mining group in the coming financial year."