[Ferro-Alloys.com]Total tonnes of manganese ore production for 2015 decreased 14% compared to 2014. Australian manganese ore production decreased 24% and Ghanaian manganese ore production decreased 1% compared to 2014.

Manganese C1 cash costs1 for 2015 were $2.09/dmtu compared to $2.46/dmtu in 2014, a decrease of 15% continuing the positive trend seen over recent years.

Total manganese sales tonnes for 2015 decreased 4% compared to 2014. Australian manganese tonnes sold decreased 27% but Ghanaian manganese tonnes sold increased 28%.

Average manganese FOB sales price achieved decreased 33% from $3.98 in 2014 to $2.68 in 2015.

The annual average price for manganese lump (CRU, 44%Mn CIF China) in 2015 was $3.11/dmtu, a decrease of 32% from $4.56/dmtu in 2014. In 2015, pricing for the company’s WW46L ore from Australia started the year at $4.65 and ended the year at $2.40/dmtu, a decrease of 48%.

Based on the December 2015 resource and reserves statement total Ghanaian reserves have decreased 8% but resources have increased 4% compared to the December 2014 statement. The equivalent comparison for the Australian business at December 2015 shows a 15% decrease in reserves and a 4% decrease in resources compared to the December 2014 statement.

Adjusted EBITDA2 for 2015 was $40 million, down from $127 million in 2014, principally due to lower pricing partially offset by reduced mining costs. As a consequence Cash EBITDA2 for 2015 was $21 million, down from $80 million in 2014. The Company recorded a loss for the year of $319 million compared to a net loss from continuing operations of $7 million in 2014.

For the year ended 31 December 2015 the Company recorded a $256 million impairment charge for the year of which $155 million related to the impairment of Australian Manganese non-current assets, $36 million related to the impairment of Australian Iron Ore non-current assets and $65 million related to the Group’s investment in OM Holdings Limited, $55 million of which has been reclassified from reserves having being recognised in prior periods as revaluation losses in other comprehensive income. The impairments arose as a result of the significant decline in commodity pricing during the year.

In 2015 the Company recognised $50 million in other operating income relating to funds received from Tianyuan Manganese Industry Co Ltd (TMI) for access to future purchases of Ghanaian manganese ore. These funds were received following a negotiated agreement between Consmin and TMI in May 2015 which concluded the differences that had arisen in their relationship including the termination of all existing legal proceedings and the re-establishment of their mutual trading relationship.

During the year the Company recognised an expense of $17 million relating to the net write-down of capitalised exploration costs and accumulated amortisation associated with the relinquishment of tenements held by our Australia operations to the Department of Mines and Petroleum.

During the year the Company had an operating cash inflow from continuing activities of $89 million (inclusive of $50 million TMI settlement income) compared to an inflow of $32 million in 2014.

Cash and cash equivalents net of overdraft increased by $16 million from $60 million at 31 December 2014 to $76 million at 31 December 2015 with net debt decreasing by $35 million to $311 million over the same period.

Total capital expenditure for the group in 2015 was $20 million, 54% lower than in 2014, as a result of reduced exploration activity in order to maintain liquidity in light of difficult market conditions for manganese ore.

 

Key Performance Indicators

	Year Ended
Unaudited	31 December 2015	31 December 2014	% change
Manganese ore produced (dry kt)	2,763.0	3,194.5	(13.5%)
Manganese ore sales (dry kt)	2,684.4	2,786.1	(3.7%)
Average C1 manganese unit cash cost ($/dmtu)¹	2.09	2.46	(15.0%)
Average manganese FOB Sales price ($/dmtu)	2.68	3.98	(32.7%)
Revenue ($ million)	256.7	420.8	(39.0%)
Adjusted EBITDA ($ million)2	39.8	127.1	(68.7%)
‘Cash’ EBITDA ($ million)2	21.3	80.3	(73.5%)
Loss for the year from continuing operations	(318.5)	(7.3)	(4263.0%)

 

	At 31 December 2015	At 31 December 2014	% change
Cash and cash equivalents ($ million)	79.1	82.1	(3.7%)
Gross debt ($ million)	(390.3)	(428.6)	(8.9%)
Gross debt excluding high yield bonds ($ million)	(17.2)	(44.0)	(60.9%)
Net debt ($ million)	(311.2)	(346.5)	(10.2%).