Metro Mining Ltd (ASX:MMI) had a great year in 2019 achieving budgeted sales of 3.5 million tonnes and reducing site based operating costs at the Bauxite Hills Mine on Western Cape York by 15% year on year.
This helped the company achieve a gross profit of $25.97 million and a net profit of $3.62 million for 2019. Metro ended the year with net cash of $32.54 million.
The company’s partnering contractors and workforce have performed well over the wet season and the subsequent start-up of operations for 2020.
Metro’s first shipment sailed on April 19 2020 and the company achieved an above budget mining rate for April with production tracking above budget since.
The company is continuing to ship products under its existing contract with Xinfa. The planned June quarter production is sold, and the shipping schedule is finalised.
Metro is also continuing to negotiate with several potential new and existing customers.
Stage 2 expansion
Work has been completed on engineering and design work related to the stage 2 expansion to an annual operating production rate of 6 million wet metric tonnes.
However, the formal commitment to stage 2 is being influenced by the uncertainty for global growth and the current associated weakness in aluminium and alumina prices.
Metro is looking for more clarity post the Covid-19 crisis before committing to the stage 2 expansion.
At this time, the completion of stage 2 is not expected to occur prior to the second half of 2021.
Production next year is, therefore, likely to be between 4 to 5 million wet metric tonnes rather than the previous guidance of 6 million tonnes.