Sheffield Resources (SFX) investor relations material

Executive summary

• The 50%-owned KMS joint venture operating Thunderbird is the core focus; funding for the South Atlantic option remains suspended.

• Thunderbird mined a quarterly record 3.4Mt of ore, up 20% QoQ, and produced 245,982t of concentrate, up 21%.

• Mining, recoveries and production improved for a second consecutive quarter following operational changes; the revised plan targets higher mining capacity, reliable processing and logistics.

Financial highlights

• KMS net operating cash inflow was A$0.2m; deferred shipment and payment timing affected quarterly cash flow, which would have been ~AUD 10m higher if the shipment had completed in-quarter.

• KMS quarter-end cash was A$2.083m, down from A$7.437m; net cash movement was negative A$5.220m, including investing outflows and financing repayments.

• Quarterly operating cash used at the entity level was A$588,000; cash reserves were A$3.428m, with estimated funding for 5.8 quarters at the reported cash-flow rate.

• C1 cash cost was A$217/t produced (A$223/t excluding inventory movement), down from A$261/t (A$252/t); higher volumes reduced per-tonne costs.

• Diesel prices added ~A$2m in quarterly costs; capital expenditure primarily covered in-pit tailings walls, with no interest paid and lease payments continuing.

Outlook and guidance

• December-quarter forecast: 3.0–3.4Mt ore mined, 175,000–200,000t ilmenite and 45,000–55,000t zircon produced; C1 cash costs of A$220–A$230/t produced.

• December-quarter shipments are forecast at 200,000–230,000t of ilmenite and 45,000–55,000t of zircon; zircon pricing is expected broadly in line with September-quarter levels.

• Catch-up shipments are targeted for both products; shipping produced product is expected to generate operating cash flow in the December quarter.

• March-quarter guidance may have a wider range due to wet-season loading constraints; shipment impacts are normally expected to be caught up in June.