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Metro Mining shares rise on bauxite quarterly result

The company has increased its 2019 bauxite production guidance by 17%.
stacks of coins representing growth
Shares are trading up 6.6% intra-day last priced at 16 cents each

Metro Mining Ltd (ASX:MMI) produced 743,000 wet metric tonnes (wmt) of bauxite in the December quarter from its Bauxite Hills Mine in north Queensland.

This confirms earlier indications that 2018 production guidance of over 2.0 million wmt has been achieved.

Furthermore, using data from both the September and December quarters, the mining operation is producing at an annualised run-rate of 2.5 million wmt per annum.

Notably, Metro has boosted 2019 bauxite production guidance by 17% to 3.5 million wmt from 3.0 million wmt,

READ: Metro Mining to bring Bauxite Hills mining in house, restart operation in June quarter

Importantly, bauxite was being mined for $49.68 per wmt including freight and royalties while the average sale price was $60.7 per wmt for the December quarter.

Mine EBITDA for the quarter was a solid A$8.6 million and is expected to significantly increase as production volumes expand and as operational improvements and upgrade initiatives are implemented.

This flowed through to positive cash flow and cash and receivables increasing to $40.15 million at the end of the December quarter.

Stage II DFS underway

An updated definitive feasibility study (DFS) for potential stage II expansion of annual production to 6.0 million wmt per annum by 2021 was also commenced during the quarter.

The DFS will be updated to incorporate operating experience to date, operational improvements and upgrades being implemented and strengthening bauxite market conditions in China.

The study is on track to be completed in the June quarter of 2019.

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