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ANDRADA MINING LIMITED
Earnings Release • Mar 27, 2024
7481_bfr_2024-03-27_d2459870-352d-4b9f-924d-642ea7b2a520.html
Earnings Release
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National Storage Mechanism | Additional information 
RNS Number : 4830I
Andrada Mining Limited
27 March 2024
The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 (MAR) as in force in the United Kingdom pursuant to the European Union (Withdrawal) Act 2018. Upon the publication of this announcement via Regulatory Information Service (RIS), this inside information will be in the public domain.
Andrada Mining Limited
("Andrada" or the "Company")
Operational update for the period ended 29 February 2024.
54% increase in tin concentrate production to 1 474 tonnes.
Andrada Mining Limited (AIM: ATM, OTCQB: ATMTF), the African technology metals mining company with a portfolio of mining and exploration assets in Namibia, hereby provides an unaudited operational update for the 12 months ended 29 February 2024 ("FY2024").
HIGHLIGHTS
Operations
§ 60% year-on-year ("YoY") increase in ore processed to 915 599 tonnes (FY2023: 573 818 tonnes).
§ 54% YoY increase in tin concentrate production to 1 474 tonnes (FY2023: 960 tonnes).
§ 51% YoY increase in contained tin production to 885 tonnes (FY2023: 587 tonnes).
§ Plant availability increased to 91% in FY2024 (FY2023: 87%).
§ Tin recovery increased to 72% in FY2024 (FY2023: 69%).
§ Production of five tonnes of saleable tantalum concentrate.
§ Production of 40 tonnes saleable lithium concentrate.
Financial
§ Average C1¹ operating cash cost compared to management guidance of between USD 17 000 and USD 20 000 per tonne of contained tin:
- FY2024 at USD 17 640 was within guidance.
- 14% decrease in C1 costs quarter-on-quarter ("QoQ").
§ Average C2² operating cash cost compared to management guidance of between USD 20 000 and USD 25 000 per tonne of contained tin:
- FY2024 at USD 20 173 was within guidance.
- 12% decrease in C2 QoQ.
§ All-in sustaining cost ("AISC") compared to management guidance of between USD 25 000 and USD 30 000 per tonne of contained tin:
- FY2024 at USD 26 223 was within guidance.
- 13% decrease in AISC QoQ.
§ The Company will provide updated guidance in the Q1FY2025 operational update.
§ Unaudited cash balance on 29 February 2024 of GBP 17.5 million (USD 22.2 million).
Strategic Process
§ Indicative, non-binding offers received for a partnership interest at the project level.
§ Discussions with potential partners are progressing well.
Anthony Viljoen, Chief Executive Officer, commented:
"It pleases me that the strategic operational initiatives that we embarked on have been successful and yielded the further double-digit percentage increases in production tonnage at our operations that we are presenting today. Although the higher stripping resulted in an increase in the AISC during the year, the exposure of the orebody's grade, diversity of minerals including lithium, and scale at depth according to our geological model, will start to become glaringly apparent placing the operations in a robust position to capitalise on the rebound in the commodities markets for all our products."
OPERATIONAL review
Table 1: Uis Mine unaudited TIN production and cost performance
| Feed grade | % Sn | 0.151 | 0.161 | 0.141 | 0.137 | 0.148 | 0.148 | 0% | -3% |
| Plant processing rate | tonnes per hour | 135 | 138 | 138 | 137 | 137 | 106 | 29% | -1% |
| Ore processed | tonnes | 217 189 | 232 154 | 228 234 | 238 022 | 915 599 | 573 818 | 60% | 4% |
| Tin concentrate | tonnes | 359 | 398 | 346 | 371 | 1 474 | 960 | 54% | 7% |
| Contained tin | tonnes | 216 | 238 | 202 | 231 | 885 | 587 | 51% | 14% |
| Tin recovery* | % | 70 | 67 | 66 | 72 | 69 | 68 | 1% | 9% |
| Plant availability | % | 91 | 92 | 89 | 89 | 91 | 87 | 5% | 0% |
| Plant utilisation | % | 79 | 83 | 86 | 89 | 84 | 66 | 27% | 4% |
| Uis mine C1 operating cost ¹ | USD/t contained tin | 15 741 | 19 560 | 18 917 | 16 273 | 17 640 | 19 762 | -11% | -14% |
| Uis mine C2 operating cost ² | USD/t contained tin | 18 235 | 22 252 | 21 386 | 18 775 | 20 173 | 22 287 | -9% | -12% |
| Uis mine AISC ³ | USD/t contained tin | 21 377 | 26 671 | 30 452 | 26 616 | 26 223 | 24 939 | 5% | -13% |
| Tin price achieved | USD/t contained tin | 25 149 | 25 183 | 24 749 | 26 125 | 25 593 | 25 051 | 2% | 6% |
C1¹ refers to operating cash cost per unit of production excluding selling expenses and sustaining capital expenditure associated with Uis Mine.
C2 ² operating cash cost is C1 plus selling expenses including logistics, smelting and royalties.
All-in sustaining cost³ incorporates all costs related to sustaining production; capital expenditure associated with developing and maintaining the Uis operation as well as pre-stripping waste mining costs.
*Tin recovery includes stockpiles.
TIN
Review of performance
Ore processed increased by 60% to 915 599 tonnes and the plant processing rate increased by 29% YoY to 137tph, all due to the plant expansion in FY2023 and the preliminary impact of the Continuous Improvement 2 programme ("CI2"). Annual tin concentrate production increased by 54% to 1 474 tonnes (FY2023: 960 tonnes) resulting in a 51% increase in contained tin to 885 tonnes (FY2023: 587 tonnes) YoY.
Contained tin tonnage produced in Q4 increased by 14%, a higher rate than the 7% increase in tin concentrate, due to tantalum concentrate separation. The extraction of tantalum resulted in an increase in tin concentrate grade by 16% between December 2023 and February 2024.
Production expansion plan
The Company is implementing a production expansion project at the existing tin processing plant to 2 600 tpa (or 1 600 tpa of tin metal) in line with the Orion tin royalty requirements. The production expansion will be facilitated through the installation of a pre-concentration circuit that incorporates ore-sorters.
The net effect of the ore-sorters is expected to be an increase of approximately 50% in the tin content to the wet processing plant. The CI2 will augment the pre-concentration circuit, enabling plant production to reach the targeted run-rate by April 2025. Commissioning of the pre-concentration circuit is planned for the first quarter of 2025. This expansion is anticipated to increase revenue by up to 75% and to reduce the AISC. (See announcement dated 12 March 2024) .
TANTALUM
Optimisation of the circuit has been completed, and 7.4 tonnes of tantalum concentrate were produced during Q4. The current concentrate production rate is 48tpa and is expected to increase to approximately 83tpa after implementation of the ore-sorting facility. The Company is on track to supply tantalum to AfriMet on a quarterly basis, commencing March 2024. The revenue from the tantalum concentrate is anticipated to increase total group revenue by between 3% and 5%. (See announcement dated 12 March 2024) .
LITHIUM
Lithium Pilot Plant
Approximately 40 tonnes of saleable, technical-grade lithium concentrate was produced and stockpiled by the end of the reporting period. The production rate is expected to increase to 100 tonnes per month by the end of March 2024. Internal test work confirms that this technical-grade material meets the specifications for the glass-ceramics market, and Andrada is exploring additional offtake agreements with both industrial and battery chemical markets.
FINANCial
All unit costs were at the lower level of management guidance for the full year. Furthermore, all the costs decreased by double digit percentage points in Q4 due to higher tonnages and enhanced efficiencies as the Company implements the CI2 programme. AISC declined from USD30 452 per tonne in Q3 to USD26 616 in Q4, mainly due to the decrease in the stripping ratio from 4.51 at the end of November 2023 to 3.21 at the end of February 2024. The unaudited cash balance on 29 February 2024 was GBP 17.5million (USD 22.2 million).
STRATEGIC PROCESS
Since the launch of the Strategic Process to identify an appropriate partner for the lithium development, leading international organisations within the lithium value chain have visited the Company's assets in Namibia, have conducted mineralogical test work, and have implemented detailed due diligence. Andrada has narrowed down the various non-binding indicative offers that have been received to date and discussions are ongoing with the objective of progressing to final binding bids.
The Company is encouraged by the keen interest that has been shown and will work expeditiously to make a value-accretive decision for its shareholders. The Company will keep the market updated as matters progress.
Glossary of abbreviations
| AISC | All In Sustaining Cost |
| CY | Calendar year for the 12 months ending December |
| CI2 | Continuous Improvement 2 programme |
| FY | Financial year for the 12 months ending March |
| GBP | British pound sterling |
| NAD | Namibian dollar |
| Q3 | Third quarter ending November |
| Q4 | Fourth quarter ending February |
| USD | United States dollar |
| # CONTACT | |
| ANDRADA MINING LIMITED | |
| Anthony Viljoen, CEO Sakhile Ndlovu, Investor Relations |
+27 (11) 268 6555 [email protected] |
| NOMINATED ADVISOR | |
| WH Ireland Limited Katy Mitchell |
+44 (0) 207 220 1666 |
| CORPORATE BROKER & ADVISOR | |
| H&P Advisory Limited Andrew Chubb Jay Ashfield Matt Hasson |
+44 (0) 20 7907 8500 |
| Berenberg Jennifer Lee Natasha Ninkov |
+44 (0) 20 3753 3040 |
| WHI Capital Markets Harry Ansell |
+44 (0) 20 7220 1670 |
| FINANCIAL PUBLIC RELATIONS | |
| Tavistock (United Kingdom) Jos Simson Catherine Drummond Adam Baynes |
+44 (0) 207 920 3150 [email protected] |
About Andrada Mining Limited
Andrada Mining Limited, formerly Afritin Mining Limited, is a London-listed technology metals mining company with a vision to create a portfolio of globally significant, conflict-free, production and exploration assets. The Company's flagship asset is the Uis Mine in Namibia, formerly the world's largest hard-rock open cast tin mine.
An exploration drilling programme is currently underway with the aim of expanding the tin resource over the fourteen additional, historically mined pegmatites that occur within a 5 km radius of the current processing plant. The Company has set a mineral resource target of 200 Mt to be delineated within the next 5 years. The existing mine, together with its substantial mineral resource potential, allows the Company to consider economies of scale.
Andrada is managed by a board of directors with broad industry knowledge and a management team with extensive commercial and technical skills. Furthermore, the Company is committed to the sustainable development of its operations and the growth of its business. This is demonstrated by the way the leadership team places significant emphasis on creating value for the wider community, investors, and other key stakeholders. Andrada has established an environmental, social and governance system that has been implemented at all levels of the Company and aligns with international standards.
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