METMAR LIMITED - Trading Statement

Release Date: 08/10/2014 15:30
Code(s): MML
Wrap Text
Trading Statement

Incorporated in the Republic of South Africa
(Registration number 1998/007269/06)
Share code: MML
ISIN code: ZAE000078747
(“Metmar” or "the Company")


In terms of paragraph 3.4 (b) of the JSE Limited (“JSE”) Listings Requirements, companies are required to
publish a trading statement when satisfied to a reasonable degree that the financial results of the period to
be reported upon will differ by 20% or more from the financial results of the previous corresponding period.

Shareholders are advised that for the six months ended 31 August 2014 the Company is expected to:

    -      reduce the attributable loss per share to between 12.41 cents and 10.34 cents (25% to 45%),
           compared to a loss per share of 17.4 cents for the six months ended 31 August 2013; and
    -       headline loss per share is expected to increase, to between 24.54 cents and 20.45 cents (94%
           to 114%), compared to a headline loss per share of 11.0 cents for the six months ended 31
           August 2013.

The reduction in the attributable loss per share is a step in the right direction as a result of:
   -       Improved turnover following increased trading volumes and product diversification
   -       Reduced cash operating costs through tight controls
   -       Reversal of the impairment of investment in Sefateng Chrome Mine incurred at the 2014
           financial year end following the award of the mining right and signing of the off-take agreement.

Headline loss per share increased due to certain persistent challenges. These include:
   -       Reduced margins following a decline in iron ore and manganese prices
   -       High finance charges incurred as a result of significant stock holding, caused by delays in the
           manganese sinter toll project
   -       Our listed investment in Alphamin reduced from CAD0.39 cents to CAD0.21 cents and in Afarak
           from Euro 0.37 cents to Euro 0.31 cents. These resulted in mark to market losses.

The expected financial results per focus area are as follows:
                                       Attributable earnings / (loss)          Headline earnings / (loss)
 Focus Area                             per share – Range (cents)                      per share
 Core trading                                    3.76 – 4.52                           3.76 – 4.52
 Manganese sinter tolling project              (5.32) – (4.43)                       (5.32) – (4.43)
 Investments                                  (11.61) – (9.68)                     (23.74) – (19.78)

In view of the tightening commodity fundamentals and declining margins, we will continue to focus our
efforts on growing trading volumes and extracting full value from the manganese sinter tolling project.
The Company’s auditors have not reported on the financial information on which this trading statement is
based. Shareholders are advised that the results for the period ended 31 August 2014 will be released no
later than 31 October 2014.

8 October 2014

Nedbank Capital

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