Bushveld Minerals (BMN) H1 2024 earnings summary

Executive summary

• Revenue from continuing operations fell 54% year-over-year to $25.6 million, driven by a 30% drop in average realised vanadium price and a 34% decrease in sales volumes.

• Adjusted EBITDA loss from continuing operations was $14.3 million, compared to a $12.6 million profit in H1 2023; net loss widened to $45.0 million from $12.5 million.

• Vanchem processing plant classified as a discontinued operation and held for sale, with an impairment loss of $12.3 million recognized to align with expected sale proceeds.

• Significant cost-cutting and operational turnaround initiatives underway at Vametco, targeting annualized savings of $8-10 million by end-2025.

• Group remains dependent on timely receipt of funds from SPR and continued support from Orion to maintain liquidity and meet obligations.

Financial highlights

• Revenue from continuing operations: $25.6 million (H1 2023: $55.1 million); group sales: 949 mtV (H1 2023: 1,428 mtV); average realised price: $26.9/kgV (H1 2023: $38.6/kgV).

• Adjusted EBITDA loss: $14.3 million (H1 2023: $12.6 million profit); operating loss: $18.6 million (H1 2023: $7.9 million profit); net loss: $45.0 million (H1 2023: $12.5 million loss).

• Free cash outflow: $18.1 million (H1 2023: $2.7 million outflow); cash and cash equivalents: $1.0 million (Dec 2023: $1.3 million); net debt: $124.0 million (Dec 2023: $105.7 million).

• All-in sustaining cost (AISC) from continuing operations: $42.9/kgV (H1 2023: $30.8/kgV), up 40% year-over-year.

• Loss from discontinued operations (Vanchem): $24.2 million, up from $6.2 million, mainly due to impairment and lower prices.

Outlook and guidance

• Targeting sustainable Vametco production of 240 mtV/month by Q4 2024; full-year group production guidance (excluding Vanchem post-sale) to reduce by 400 mtV.

• Weighted average production cash costs for H2 2024 expected between $26.7/kg and $27.1/kg.

• Group's ability to continue as a going concern depends on completion of Vanchem and Mokopane sales, support from Orion, and achieving higher vanadium prices ($29.15/kgV for H2 2024, $34.40/kgV for 2025).

• Material uncertainties remain regarding liquidity and funding, with significant reliance on external funding and asset sales.