CuDeco is trying to convince its auditors it can stay in business; chief heads for the exit
Copper producer CuDeco has been suspended from the ASX for four months now and is frantically trying to resume trading.
The company (ASX:CDU) was initially suspended while it worked on an ore reserve update, but it is now trying to finalise last year’s financials.
At the same time, Gongyang Jiang has quit his role as CEO for “personal reasons”.
CuDeco says the task of completing its 2017 financials is dependent on the company satisfying its external auditors that it can “continue as a going concern”.
To do that the company is working with major creditors, banks, financiers and major shareholders to put in place a financial plan.
Once that is done CuDeco can complete its financials and resume trading.
“The board extremely regrets the suspension of share trading and aims to resume trading as quickly as possible, pending the completion of the necessary financial statements,” chairman Peter Hutchison said.
The past seven months have been challenging for CuDeco, which has faced several disruptions at its Rocklands copper mine in Queensland.
In December, the company was forced to suspend operations at the mine by the State government after a number of safety issues were identified with the processing plant.
It then faced further disruption from extreme storms, which washed out a section of the access road to the Rocklands site.
CuDeco told investors in a corporate update today that since the end of the last quarter, production had been affected by ore that had high levels of chlorite, which reduced plant throughput and copper recoveries.
In the June quarter, the company produced 13,852 tonnes of copper concentrate at an average grade of 25.24 per cent.
This was from the processing of 454,713 tonnes of ore with an average head grade of 1.22 per cent, achieving an overall recovery of 63 per cent.
But CuDeco expects production to pick up over the next six months because it will be processing primary sulphide ore types, which have historically achieved recovery rates of over 90 per cent.
To aid in the company’s turnaround, CuDeco has named experienced mining executive Logan Francis as the new general manager for the Rocklands operation.
CuDeco has been contacted for comment.