Kenmare Resources (KMR) H1 2024 earnings summary

Executive summary

• Revenue declined 33% year-over-year in H1 2024 due to lower shipments, pricing, and product mix, but EBITDA margin remained strong at 41%–>40% and net cash reached a record $58.9 million.

• Profit after tax was $20.9 million, down 69% year-over-year, with an interim dividend of USc15 per share declared; full-year payout expected at the upper end of the 20–40% profit after tax range.

• Tom Hickey succeeded Michael Carvill as Managing Director after 38 years.

• Company remains focused on safety, community relations, and environmental sustainability.

• Major capex projects, including the Nataka transition, are on schedule and key to long-term production.

Financial highlights

• Mineral product revenue was $154.5 million (down 33% YoY); EBITDA was $63.2 million (down 43% YoY) with a margin of 41%; profit after tax was $20.9 million (down 69% YoY).

• Cash operating cost per tonne of finished product was $218 (down 5% YoY); per tonne of ilmenite was $201 (up 47% YoY).

• Net cash at period-end was $58.9 million, up from $20.7 million at year-end 2023.

• Total cash operating costs were $107.2 million (down 2% YoY); total operating costs were $132.3 million (down 19% YoY).

• $35 million in dividends paid and prior debt facility fully repaid; no outstanding debt at period-end.

Outlook and guidance

• On track to achieve 2024 ilmenite production guidance of 950,000–1,050,000 tonnes plus co-products.

• H2 2024 expected to see increased shipments and higher average prices due to delayed zircon shipments and improved weather.

• Revenue and profitability anticipated to be materially stronger in H2, with finished product inventories expected to normalize in H1 2025.

• Full-year dividend payout expected at the upper end of the 20–40% profit after tax range.

• Net debt expected to increase in H2 2024 as capex is spent on WCP A transition.