Record year for Kenmare Resources as production and sales rise

Dublin and London listed mining company Kenmare Resources reported a record year for production and sales, with strong momentum continuing into 2022.

In a trading update the company said it achieved its production guidance for the year for ilmenite, primary zircon and concentrates in 2021.

Kenmare Resources also highlighted its lowest ever lost time injury frequency rate of 0.03 per 200,000 hours worked to the end of the year, with the company recording a year without a lost time injury on January 6th, 2022.

Annual heavy mineral concentrate production also hit a record at more than 1.5 million tonnes, up 30 per cent year-on-year as tonnes mined increased and higher ore grades contributed.

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Finished product shipments were just under 1.3 million tonnes for the year, up 51 per cent, on increased production and improved trans-shipment capacity.

The mining company said prices were higher than average during the year, with strong demand for Kenmare’s products and low ilmenite inventories in the global supply chain boosting prices into 2022.

During the year the company bought back 13.5 per cent of its issued share capital, returning almost $82 million to shareholders by the end of the year.

Net debt for the year was $82.8 million at year-end, up from $64 million a year earlier, with cash and cash equivalents of $69.1 million following the share buy-back.

Shipments

Managing director Michael Carvill said 2021 was a record year for Kenmare in terms of safety, production and sales, with ilmenite production up 48 per cent year-on-year and shipments up 51 per cent.

“In 2021 we received higher average prices for all products compared to 2020 and the outlook for 2022 remains buoyant,” he said.”We were delighted to return almost $100 million to shareholders during the year through dividend payments and a share buy-back, and we continue to target a 25 per cent profit after tax total dividend payment in respect of 2022.”

Kenmare said its ilmenite production guidance range was 1.125 million to 1.225 million tonnes for the coming year, with production of all finished products expected to be higher in 2022.

Total cash operating costs are also expected to increase due to higher tonnes mined and inflation.

Spending on development projects and studies is expected to be approximately $28.5 million.