Bisie mine operator Alphamin Resources (TSXV: AFM; JSE AltX: APH) has announced a 156% quarter-on-quarter increase in earnings before interest, taxes, depreciation, and amortisation (EBITDA) in the first quarter of 2024.
In the quarter ending 31 March 2024, ore processing increased 4% from the previous quarter to 109,424 tonnes, balanced by a 4% decrease in grade to 3.83% Sn. On unchanged tin recovery of 75%, overall tin-in-concentrate production saw a marginal increase to 3,142 tonnes from 3,126 tonnes. Sales, however, increased 102% to 4,126 tonnes from 2,046 tonnes in the previous quarter.
EBITDA increased by 156% from US$20.3 million to US$52.0 million. The company attributed the increase in EBITDA to the clearance of most of the Q4 2023 sales backlog and 7% higher tin prices. Sales in the fourth quarter of 2023 had been disrupted due to exceptional rainfall in DR Congo damaging infrastructure on key trade routes.
All in sustaining costs (AISC) saw a marginal increase to $14,785 per tonne of tin sold, attributed to increased royalties, export duties, marketing commissions, and net smelter returns – in turn due to the increased tin price. The company’s cash reserves increased to US$53.5 million as of 31 March 2024, up from US$7.2 million on 31 December 2024 while net debt decreased from US$73 million to $28 million.
The company’s major expansion project, Mpama South, Democratic Republic of Congo, is behind schedule on delays to the commissioning of the new processing plant. Engineering teams are now in the final stages of plant commissioning, while crushed ore stockpiles have reached 5,300 tonnes. The expansion is expected to increase Alphamin’s production capacity from approximately 12,500 tonnes tin per annum to 20,000 tpa.
Our view: With the Bisie mine contributing 4.0% of the world’s mined tin in 2023, and in the light of continued supply disruptions elsewhere in the world, the market eagerly anticipates the opening of the significant Mpama South expansion.
