• Core delivers a maiden NPAT of $10.3m for FY23 on shipments of just 5423t of concentrate, 14,774t of direct shipped lithium ore
  • Another strong morning for yellowcake hopefuls as the uranium spot price pushes relentlessly through 15-year highs
  • Bowen Coal’s senior and subordinated lenders, Taurus Mining Finance and coal producer New Hope (ASX:NHC) have given it a stay on its debt repayment

Here are the biggest small cap resources winners in early trade, Friday September 29.

 

Core Lithium (ASX:CXO)

Finniss lithium mine owner Core Lithium has faced a year from hell on the share market, down around 60% on a series of downgrades that didn’t do much to excite the market.

Some things are effectively out of the control of the lone Territorian spodumene producer — lith prices are down well over 50% this year thanks to stalling demand growth in China.

Others are more self-imposed — large, discounted capital raisings, disappointing Li2O recoveries and production guidance for FY24 set at around 60% of Core’s 175,000tpa nameplate capacity.

But once you’re in production it’s a margin game, and hard rock lithium is still selling at prices that give pretty much all producers the margin to prosper.

So it is that Core is up 20% this morning on news the $850 million battery metals miner has delivered a maiden profit for FY23 in its annual report today on shipments of just 5423dmt of spodumene concentrate and 14,774dmt of direct shipped lithium ore.

That pales in comparison to the 90,000-100,000t of spodumene concentrate it plans to sell this financial year, but still backed operating cash flows of $90.8m and an NPAT of $10.8m, from $50.6m in revenue and $14m in EBITDA.

Since June 30 Core’s sales have risen further, with the miner shipping 23,100dmt of spod and 15,000dmt of lithium fines to customers. While it pulled out of a deal to supply Elon Musk’s EV giant Tesla, it has major Chinese buyers Yahua and Ganfeng on its customer books.

Following a recent $111.4m placement and share purchase plan Core had $153m in the bank as of June 30.

CEO Gareth Manderson said delivering a maiden profit was a “significant achievement and a testament to the strategy to move quickly to production in a strong pricing environment.”

While mining is currently taking place at the Grants Pit, Core views the BP33 underground development as its potential long term cornerstone asset, with an FID due in the March quarter.

“While the breadth and scope of the work at Finniss has expanded significantly, our strategy to drive long-term shareholder value is unchanged – ramp up Grants production and deliver spodumene concentrate into long-term offtake agreements, grow the broader Finniss district mine life through the development of deposits in the region near the established processing infrastructure and pursue longer-term growth initiatives through our exploration program,” Manderson said.

Core Lithium (ASX:CXO) share price today

 

ALL THE URANIUM

Another strong morning for yellowcake hopefuls as the uranium spot price pushes relentlessly through 15-year highs.

How high will it go? No one knows, but we are now at a price point where most ASX development projects can enter production and make good coin.

ASX uranium stocks are responding accordingly.

24 of the 36 companies on our list are up over the past week. Over the past month there are 30 gainers, with miners/near term producers Bannerman (ASX:BMN), Deep Yellow (ASX:DYL), Boss Energy (ASX:BOE) and Paladin (ASX:PDN) up a healthy 50%, 48%, 43% and 32%, respectively over that period.

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Amongst the avalanche of Annual Reports are a handful of speccys pushing out news today, including Gladiator Resources (ASX:GLA), Alligator Energy (ASX:AGE) and Laramide Resources (ASX:LAM).

GLA’s main game is the Mkuju project in Tanzania, which has two established resources at Mtonya (1.9Mlbs U3O8) and Likuyu North (4.6Mlbs U3O8).

Today it announced uranium hits in its first trench at the newly acquired SWC target at Mkuju, including a highlight 8m at 1,273ppm U3O8 from surface (including a 2m chunk at 3,825ppm).

GLA says 30m long zone displayed reading on the scintillometer – a device to measure radioactivity –over 1000 counts per second (cps) and up to >9,999 cps, the maximum for the device.

Off the charts. GLA says drilling will follow completion of the trenching program.

 

Dual-listed LAM is drilling into near surface uranium at the Amphitheatre target, designed to grow the 51Mlb resource at the Westmoreland project in QLD.

The first two holes of the nine-hole program hit multiple, plus 1m mineralised horizons grading up to 2,452ppm (0.25%) U3O8 at the target.

Results of the remaining seven holes are pending.

LAM says Westmoreland is already one of the largest uranium development assets held by a junior mining company.

A 2016 project PEA – the equivalent of a scoping study — describes an “economically robust”, open-pit mining project with a mine-life of 13 years.

 

AGE non-exec director Fiona Nicholls has displayed a bit of confidence in the stock, shelling out ~$53,000 to buy 1m shares on market at 5.3-5.4c/sh.

That’s a touch more than shareholders will have to pay (5.2c) if they wish to apply for new shares as part of AGE’s $3m SPP, but Nicholls is in the money regardless – the $200m capped company is sitting pretty at 5.65c lunchtime Friday.

AGE is focused on the 18.1Mlb and growing Samphire project in South Australia, where a scoping study has outlined a low cost, low impact start-up.

An updated resource is due November, with feasibility studies pencilled in for 2024.

 

Bowen Coking Coal (ASX:BCB)

Ambitious junior coking coal miner Bowen surged to record highs last year in the hopes all time coal prices would help chairman Nick Jorss repeat the feat from his days building Stanmore Coal (ASX:SMR).

Not quite, operational problems and a falling market for PCI coal (pulverised coal for injection) have led to balance sheet problems, strategic reviews and mine closures.

Bowen saw cash outflows of almost $20 million in the June quarter, prompting a revision of its mining plans in Queensland’s Bowen basin, shifting focus from the Broadmeadow East pit to the Ellensfield South deposit at the Burton complex and, yesterday, deciding to put the Bluff PCI mine on care and maintenance.

While premium hard coking coal prices have risen back over US$300/t on rising Chinese steel demand recently PCI — a cheaper coal product that generally brings down costs in the blast furnace — has suffered with an influx of cheap Russian supply hitting the market.

Today’s good news is that Bowen’s senior and subordinated lenders, Taurus Mining Finance and coal producer New Hope (ASX:NHC) have given it a stay on its debt repayment, deferring principal returns for 12 months.

“The material amendments include extension of tenor, deferment of principal amortisation for the next 12 months and a modest increase in interest margins and royalties payable. BCB’s senior
and subordinated debt providers remain supportive of the Company and its operational strategy,” Bowen said today.

“The extended maturities provide headroom for the business debt repayment while steady-state production is achieved at the Ellensfield South Pit, part of the Company’s Burton Complex north of Moranbah.”

First ROM coal from Ellensfield South is being processed with trial cargoes to be sent to customers in the December quarter.

BCB CFO Daryl Edwards said Bowen had shipped a record 562,000t of coal across 10 vessels this quarter, 55% of its met coal, which is currently drawing a big premium over thermal products.

 

Bowen Coking Coal (ASX:BCB) share price today

 

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