Strategic Minerals (SML) H1 2024 earnings summary

Executive summary

• Achieved a pre-tax profit of $950,000 for H1 2024, a significant increase from $54,000 in H1 2023, driven by the return of a major client at Southern Minerals Group and the highest six-month revenue since 2017 at $2.136m.

• After-tax profit rose to $667,000, up from $38,000 in H1 2023, with after-tax profit margin increasing to 31% from 5% year-over-year.

• Cash flow improved, with unrestricted cash at $280,000 as of June 30, 2024, compared to $112,000 at year-end 2023.

• Corporate activity was limited by cash flow constraints, but the company secured key mineral rights, expanding its Redmoor footprint fourfold.

• Board changes post-period included the retirement of the chairman and the appointment of two major shareholders to the board.

Financial highlights

• Revenue for H1 2024 was $2.136m, up from $782,000 in H1 2023.

• Gross profit reached $1.743m, compared to $645,000 in H1 2023.

• Operating profit was $959,000, up from $59,000 in H1 2023.

• Basic and diluted EPS for H1 2024 was $0.042, compared to $0.02 in H1 2023.

• Net cash from operating activities was $572,000, up from $289,000 in H1 2023.

Outlook and guidance

• 2024 sales are projected to exceed $4.5m, with expectations that H2 2024 Cobre sales may outperform H1.

• Management is confident in maintaining high sales levels into 2025 and is actively seeking funding for development projects.

• Repayment of short-term funding and accrued director fees is expected to be completed in H2 2024.