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Kenmare headed for low-end of guidance

Titanium minerals and zircon producer Kenmare Resources is expecting 2022 production to come in at the low end of guidance ranges following a fall in production in the second quarter owing to issues at its Moma mine in northern Mozambique.
Kenmare headed for low-end of guidance Kenmare headed for low-end of guidance Kenmare headed for low-end of guidance Kenmare headed for low-end of guidance Kenmare headed for low-end of guidance

Kenmare's Moma

The mine's heavy mineral concentrate production fell 19% year on year to 353,600 tonnes in Q2.

"Q2 production was weaker than anticipated due to higher slimes recirculation, impacting excavated ore volumes and grades. As a result, we now expect production to be at the bottom of 2022 guidance," the company's managing director Michael Carvill said.  

"Increased pricing has more than offset production and supported revenues," he added.

He noted that at the end of the first half of the year, the company had a US$17.3 million reduction in net debt, after pay $24.1 million in the 2021 final dividend.

"We are targeting a dividend payout ration of 25% profit after tax for 2022," he said.

The miner's ilmenite, primary zircon, and rutile production levels fell by 14%, 9%, and 5%, year on year to 242,900t, 13,600t, and 2,100t, respectively.

The guidance ranges from the three commodities are 1.25 million-1.23 million t, 54,400-63,200t, and 9,500-11,500t, respectively.

Cash costs per tonne of finished product are guided at $148-$171/t.

"The market for all of Kenmare's products continued to improve, with realized ilmenite prices increasing for the seventh consecutive quarter. Although global growth expectations have reduced for H2 2022, inventories remain low throughout the value chain and demand for Kenmare's ilmenite is anticipated to be robust," Carvill said.