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Independence Group swings to A$10.2M profit in Q2'17


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Independence Group swings to A$10.2M profit in Q2'17

Independence Group NL swung to a net profit after tax of A$10.2 million in the second quarter of its fiscal 2017, up from a net loss after tax of A$28.1 million a year earlier.

Profit in the three-month period ended Dec. 31, 2016, was negatively impacted by an after tax A$3.9 million expensing of a A$5.7 million Jabiru Metals Ltd. stamp duty payment, the company said Jan. 25.

Revenue for the quarter totaled A$128.5 million, up year over year from A$98.4 million.

The increase in revenue was primarily driven by higher zinc concentrate shipments from the company's Jaguar zinc operation and higher gold sales from its Tropicana gold joint venture, as well as higher metal prices for both copper and zinc.

Net cash from operating activities was nearly flat on a yearly basis at A$17.6 million.

The Tropicana mine produced 121,195 ounces of gold during the quarter, compared to 133,742 ounces produced a year ago. All-in sustaining costs came in at A$1,051 per ounce, up year over year from A$796 per ounce.

Tropicana is a joint venture with AngloGold Ashanti Ltd. which has a 70% stake and acts as operator. Independence Group's attributable output from the mine totaled 36,356 ounces.

The company produced 8,331 tonnes of zinc and 869 tonnes of copper at Jaguar, down from 9,311 tonnes of zinc and 1,447 tonnes of copper in the corresponding year-ago period. Cash costs at Jaguar were A$1.08 per pound of payable zinc, up year over year from 69 cents per pound.

Independence Group's Long nickel operation delivered 2,063 tonnes of nickel during the quarter, down year over year from 2,246 tonnes, while cash costs decreased from A$3.68 per pound to A$3.19 per pound of payable nickel.

The company expects its Nova underground mine to ramp up to full production by mid-2017, with the development remaining on budget. Initial nickel and copper concentrates were produced in October 2016, with initial shipments in December 2016.

The company maintained its full-year guidance for production, cash costs and CapEx across all operations.

During the quarter, the company repaid A$71 million of debt, reducing outstanding debt to A$200 million. In addition, it canceled a further A$79 million of its term loan facility. The group's facilities now comprise A$200 million in drawn term debt and a A$200 million revolving credit facility.

The Jaguar, Tropicana, Long and Nova mines are all located in Western Australia.