Incoming chief of Kenmare Resources Tom Hickey says the mining group is well placed to tap into strong global demand for titanium minerals, particularly ilmenite.
With much of the global supply “locked up” in large global mining groups or in China, Mr Hickey said Kenmare was one of the few independent producers that could feed emerging demand for these products.
Ilmenite, which accounts for 75-80 per cent of the group’s revenue, is used in the production of paints and pigments. Kenmare is said to command around 7 per cent of the global ilmenite market.
Despite “a choppy 2023/2024″ linked to Russia’s invasion of Ukraine, China’s real estate crash and higher interest rates, Mr Hickey insisted the outlook for ilmenite pricing remained strong.
He also noted that Kenmare was sitting on around a 100 years of titanium mineral supply at its flagship Moma mine in northern Mozambique “and wasn’t running out of resources any time soon”.
Mr Hickey, previously the company’s chief financial officer, was unveiled this week as Kenmare’s new managing director. He replaces long-standing Kenmare chief and founder Michael Carvill who steps down after nearly four decades in charge.
The Dublin-headquartered group reported a fall-off in revenue for the first-half of 2024 due to lower shipments of product from its Moma mine and reduced pricing but insisted it remained on track to achieve 2024 earnings guidance.
Mr Hickey linked the fall-off in shipments to poor weather in the early part of the year while insisting backlog would be made up in the second half of 2024.
In its latest half-year results, Kenmare reported revenue from mineral products of $154.5 million (€140.6 million) for the six months to the end of June, down 33 per cent year-on-year due to lower shipments, pricing and product mix.
Despite the lower shipments, net cash increased to a record $58.9 million, having paid $34.7 million in dividends and invested $49.1 million in capital expenditure, the company said.
“Shipments have strengthened in early H2, supported by strong visibility of customer orders, high finished product inventories and seasonally better weather conditions. Consequently, revenue is expected to be second-half weighted,” chairman Andrew Webb said.
Kenmare noted a limited process to identify Mr Hickey’s successor as chief financial officer was now under way.
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