Turnaround Initiatives Underway
Market Abuse Regulation (MAR) Disclosure
Certain information contained in this announcement would have been deemed inside information for the purposes of Article 7 of Regulation (EU) No 596/2014 until the release of this announcement
Bushveld Minerals Limited
("Bushveld Minerals", "Bushveld", "Company", or the "Group")
Turnaround Initiatives Underway
Bushveld Minerals Limited (AIM: BMN), the primary vanadium producer, announces that it has begun work on cost cutting initiatives and development works to return the Company to profitability and secure Bushveld's long-term future.
This decision is driven partly by global market conditions, but also by the recent decision to focus on our core operating asset, Vametco, while disposing of other assets, including our downstream energy assets, the Mokopane development project, and Vanchem.
On 2 September 2024, The Company announced that it had received the US$10 million in matched funding from OMF Fund III (F) Limited ("Orion") under a previously announced agreement, providing the working capital to reduce long outstanding creditor balances, and allowing management to focus on reducing costs and sustainably increasing current production rates at the Company's core asset - the Vametco mine and production facility in South Africa.
Turnaround initiatives
The Company is pursuing a multi-pronged approach to reducing costs and maintaining Vametco's production, including the following:
· Reducing the current labour complement at both Vametco and Head Office to ensure a fit for purpose structure enabling the long term sustainability of Bushveld Minerals. In this regard, and in line with the Section 189 process under the Labour Relations Act, 1995, notices will be issued to impacted employees at Vametco and Head Office.
· Reducing costs by transferring purchases of certain goods and services to longer term contracts, thereby fixing costs and providing opportunity to negotiate lower prices with preferred OEM suppliers.
· Reducing raw material consumption by ensuring assets are running efficiently according to OEM specifications.
· Several initiatives for yield improvements from kiln to finished goods, improving production on a fixed cost base.
· Increasing the capacity of the Barren Dam at Vametco remains an important debottlenecking project that will commence in Q1 2025.
In total the Company expects these initiatives have the potential to achieve savings of US$8m-$10m on an annualised basis by the end of 2025 materially reducing the cost base at Vametco and ensuring its competitiveness as one of only four primary vanadium facilities globally.
The Group will continue to prioritise sales into higher value markets, such as nitro vanadium in North America.
Craig Coltman CEO of Bushveld Minerals commented:
"These initiatives are vital to ensure a sustainable long-term business for the benefit of all stakeholders, from those that work at and live near the mine, and to those that have provided the vital funds required for Vametco to stay in business within this prolonged, weak pricing environment."
Enquiries: info@Bushveldminerals.com
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Bushveld Minerals Limited |
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+27 (0) 11 268 6555 |
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Craig Coltman, Chief Executive Officer |
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SP Angel Corporate Finance LLP |
Nominated Adviser & Joint Broker |
+44 (0) 20 3470 0470 |
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Richard Morrison / Charlie Bouverat |
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Grant Barker / Abigail Wayne |
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Hannam & Partners |
Joint Broker |
+44 (0) 20 7907 8500 |
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Andrew Chubb / Matt Hasson / Jay Ashfield |
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Tavistock |
Financial PR |
+44 (0) 207 920 3150 |
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Gareth Tredway / Tara Vivian-Neal / James Whitaker |
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ABOUT BUSHVELD MINERALS LIMITED
Bushveld Minerals is a vertically integrated primary vanadium producer, it is one of only three operating primary vanadium producers. In 2022, the Company produced more than 3,800 mtV, representing approximately three per cent of the global vanadium market. With a diversified vanadium product portfolio serving the needs of the steel, energy and chemical sectors.
Detailed information on the Company and progress to date can be accessed on the website www.bushveldminerals.com
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