Kenmare Resources (KMR) H1 2025 earnings summary

Executive summary

• Operates the world's largest ilmenite mine in Mozambique, contributing about 6% to Mozambique's GDP and 6% of global titanium minerals supply, with over 100 years of resources at current production rates.

• Achieved zero Lost Time Injuries in H1 2025, with record safety and stable operations despite a challenging environment.

• Maintained production and cost guidance for 2025, with H1 production up slightly year-over-year and a strong order book for H2.

• Weaker product markets led to a non-cash impairment charge of $100.3 million, reflecting lower pricing outlook and higher cost expectations.

• Interim dividend of USc10/share declared, with over $300 million returned to shareholders since 2019 and no impact from the impairment on dividend policy.

Financial highlights

• Mineral product revenue increased 3% year-over-year to $159.6 million, driven by higher shipments and a favorable product mix.

• Adjusted EBITDA for H1 2025 was $47.2 million, with a margin of 30%.

• Total cash operating costs rose 16% year-over-year to $124.4 million, mainly due to higher labor, security, and royalty accruals.

• Net debt increased to $85.1 million at 30 June 2025, up from $25.0 million at year-end 2024, reflecting peak CapEx spend and dividend payments.

• Interim dividend of $8.9 million paid in H1 2025.

Outlook and guidance

• 2025 production and cost guidance reaffirmed: ilmenite production expected at 930,000–1,050,000 tonnes, with stronger shipments anticipated in H2 due to improved weather and increased shipping capacity.

• Margin expected to improve in H2 as one-off costs subside and new capacity comes online.

• Net debt anticipated to rise through H2 2025, then decline as capital expenditure slows and free cash flow increases.

• Opportunity to increase shipments in H2 with the addition of a third transshipment vessel.

• Expenditure on development projects and studies revised to ~$165 million, mainly for the WCP A project.