Base metals: Symbol loses cash on first five zinc shipments from Nigeria
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Zinc producer Symbol Mining (ASX:SL1) doesn’t expect to make any money on five of its first six shipments of zinc thanks to a lab error that saw it ship much lower grades than expected.
The company shipped the first zinc concentrate from its Macy mine in Nigeria to China in late November last year.
But Symbol faced some operational issues, revealing in early March that the zinc it had been shipping was much lower than expected.
The issue was due to a lab error.
Managing director Tim Wither told Stockhead at the time that the situation was “disappointing, as we were hitting all our targets with the given facts from a reputable service provider”.
“If we knew then, what we know now, we would have made different decisions in the blending of the shipments,” he said.
The first six shipments were affected, but Symbol says it has now fixed the problem and it is shipping concentrate grades of over 40 per cent zinc.
As a result of the error in grade, Symbol says it expects to “generate negative cashflow” for the first five shipments.
Symbol’s quarterly report shows it received $625,000 in receipts from customers, but its costs pushed it to a negative cash flow of about $1.9m.
The company said it was able to implement several initiatives to reduce costs and optimise revenue during the March quarter.
Symbol has started commissioning a second processing plant, which is scheduled to be fully operational by mid-April producing at a rate of around 36,000 tonnes a year.