Half Year 2024 Ecora Resources PLC Earnings Call Transcript
Key Points
- Strong portfolio contribution of $52 million driven by high volume production within the Kestrel royalty area.
- Acquisition of a royalty over the advanced stage Phalaborwa rare earth project, targeting first production in the latter half of this decade.
- Completion of the underground mine extension project at Voisey's Bay, with significant ramp-up expected in the second half of the year.
- Healthy balance sheet with net debt of approximately $86 million and a leverage ratio of 1.4 times, well below financial covenants.
- Successful $10 million share buyback program financed through the disposal and recycling of the LIORC stake.
- Temporary halt in the construction of the West Musgrave project due to weak nickel prices, with a restart considered by February 2027.
- Lower volumes from the Mantos royalty in the first half of the year, though expected to accelerate in the second half.
- Maracas performance down year-on-year due to weaker vanadium prices.
- Significant reduction in portfolio contribution from core assets by 17% compared to the previous period.
- Expected immaterial contribution from Kestrel in the second half as mining is not expected to return to the private royalty area until the first quarter of next year.
Good morning, and thank you for joining us for Ecora's first half 2024 results presentation.
In the H1 period, we saw strong portfolio contribution of $52 million and that was driven primarily by high volume production within our Kestrel royalty area. During the period, we acquired a royalty over the advanced stage Phalaborwa rare earth project. It's a high-quality rare earth development project that's targeting first production in the latter half of this decade.
We also saw the underground mine extension project at Voisey's Bay approach completion. A key milestone for ramp-up was achieved in the first half of the year. And the second key milestone is expected to be achieved in the second half.
In light of a weak nickel price environment, BHP has temporarily halted the construction of the West Musgrave project with a restart to be considered by February 2027. And this is, of course, disappointing. Although we do remain very confident in this asset's potential as a low-cost, long-life fully permitted
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