Third Quarter Report for period ending 30 September 2011

23 Nov 2011
All figures in accordance with IFRS and in United States Dollars, unless otherwise stated

Consmin, a leading manganese ore producer with mining operations in Australia and Ghana, announces its results for the quarter ended 30 September 2011 and the nine months to that date.

Key highlights (comparing Q3 2011 to Q3 2010)

  • Consmin has continued to show strong production during the quarter – with a 23% and 103% increase in manganese and chromite production, respectively, compared to the same quarter in the prior year.
  • Consmin has produced updated JORC compliant Resource and Reserves statements for the manganese operations. Group manganese resources increased 14%, while Group manganese reserves increased 25%. The inaugural Resource and Reserves statement for the Coobina chromite mine has been produced. The JORC compliant resources are 1.5 Mt at 29.4% chromite.
  • Sales volumes continue to be strong, with a 105% increase in manganese tonnes sold, compared to the same period in the prior year.
  • Manganese revenues increased by 66% to $166.2 million from Q3 2010 to Q3 2011, despite a 15% decrease in the average price achieved in the current quarter, compared to the same quarter in the prior year.
  • The C1 cash cost remained flat at around $3.60/dmtu, comparing this quarter with the same period in the prior year. This is despite the Australian dollar strengthening by 17% against the US dollar.
  • Consmin’s excellent safety record continued, with no Lost Time Incidents (‘LTI’) reported in either country in the quarter. Additionally, on 27 October 2011, Woodie Woodie achieved a significant milestone of 1 year since the last LTI on site.
  • The chromite operations reached full ore production rates at the end of this quarter.
  • Major new shallow discovery at Woodie Woodie at the Extension Cord / Chutney prospect, with very high grade mineralised intercepts of greater than 29m at 46% Mn in three holes. Resource definition drilling at the Airport prospect continued to deliver high grade intercepts including 44m at 51% Mn, near the surface.

Key Performance Indicators

  Quarter ended Nine months ended
Unaudited 30 September 2011 30 September 2010 % change 30 September 2011 30 September 2010 % change
Manganese ore produced (dry kt) 824.6 673.2 22.5% 2,403.8 2,030.9 18.4%
Manganese ore sales (dry kt) 940.9 458.2 105.3% 2,624.0 1,580.0 66.1%
Average C1 manganese unit cash cost ($/dmtu)1 3.63 3.59 1.1% 3.64 3.17 14.8%
Average manganese FOB Sales price ($/dmtu) 5.05 5.91 (14.6%) 5.10 5.92 (13.9%)
Chromite ore produced (kt) 93.5 46.0 103.3% 225.1 113.8 97.8%
Chromite sales (kt) 91.9 67.5 36.1% 184.7 112.4 64.3%
Average C1 chromite unit cash cost ($/t)1 234 208 12.5% 238 152 56.6%
Average chromite FOB sales price ($/t) 231 247 (6.5%) 257 241 6.6%
Revenue ($ million) 188.0 126.0 49.2% 536.4 472.1 13.6%
Adjusted EBITDA ($ million)2 14.6 48.3 (69.8%) 105.2 211.3 (50.2%)


  Quarter ended Year ended  
Unaudited 30 September 2011 31 December 2010 % change
Cash and cash equivalents ($ million) 227.0 97.7 132.3%
Gross debt ($ million) 438.3 66.7 557.1%
Net debt/(cash) ($ million) 211.3 (31.0) (781.6%)

1 Average C1 manganese or chromite unit cash cost represents the cash cost incurred at each processing stage from mining through to shiploading, over the total manganese dmtus or chromite tonnes produced. Included within the C1 manganese unit cash cost are allocation of offsite, non-corporate, support services. Depreciation, government royalty payments, deferred stripping adjustments and stockpile movements are not included in the calculation.

2 Adjusted EBITDA is defined as operating profit less depreciation and amortisation, impairment write-back/expense, net foreign exchange gain/loss and non-cash inventory write-downs. Adjusted EBITDA is not a uniformly or legally defined measure and is not recognised under IFRS or any other generally accepted accounting principles. We consider this measure an important indicator of our representative, recurring operations. Other companies in the mining industry may calculate this measure differently and consequently, our presentation of Adjusted EBITDA may not be readily comparable to other companies’ figures.

Commenting on the results, Glenn Baldwin (CEO of Consmin) said:

“Consmin publishes its third quarterly report today, showing its results for the three and nine months to 30 September 2011. The results once again show increased production and sales across both our manganese and chromite operations, for both the quarter and the year to date, compared to the same periods in the prior year. The strong sales figures have led to strong revenue and gross profit results, which exceed our prior quarter results. It is pleasing to see that the key controllable performance indicators have continued to improve, as reflected in our safety performance and the reduction in our unit costs in local currency terms. While demand for our product remains strong, uncontrollable factors such as the soft benchmark manganese price and the appreciation in the value of the Australian dollar have had an adverse impact on results for the quarter. This quarter Consmin also published our updated manganese Resources and Reserves Statement, which showed a strong increase as a result of our extensive exploration programme. Consmin is also proud to publish the inaugural Resources and Reserves Statement for the Coobina chromite mine, which is a direct result of the resource definition work that we have undertaken at our chromite operations over the past 18 months.”

Download the full Third Quarter Report for period ending 30 September 2011 (PDF – 942KB)

About Consolidated Minerals Limited

Consmin is a leading manganese ore producer within mining operations in Australia and Ghana. The principal activities of the Company and its subsidiaries (the “Group”) are the exploration, mining, processing and sale of manganese products. The Group’s operations are primarily conducted through four major operating/trading subsidiaries; Consolidated Minerals Pty Limited (Australia), Ghana Manganese Company Limited (Ghana), Manganese Trading Limited (Jersey) and Pilbara Trading Limited (Jersey).

Consolidated Minerals Limited is headquartered in Jersey and the address of its office is Commercial House, 3 Commercial Street, St Helier, Jersey, Channel Islands, JE2 3RU.

Company Information

For further information, please visit our website or contact:


+44(0)1534 513 300
Glenn Baldwin, CEO
Jackie Callaway, CFO

Conference Call

There will be a conference call for analysts and bondholders on 23 November 2011 at 4pm London time.

To access the quarterly results conference call, you must first register in advance on:

The quarterly results conference call, conference ID 24181130, can then be accessed by dialling:
UK: +44 (0) 1452 580 655

Market, Economic and Industry

Market, economic and industry data used throughout this report has been derived from various industry and other independent sources. Industry publications, surveys and forecasts generally state that the information contained therein has been obtained from sources believed to be reliable, but that the accuracy and completeness of such information is not guaranteed and such industry forecasts may not have been updated. Forecasts and other forward-looking information obtained from these sources are subject to the same qualifications and uncertainties as the other forward looking statements contained in this report.

Forward-looking statements

This report includes “forward-looking statements” that express or imply expectations of future events or results. Forward-looking statements are statements that are not historical facts. These statements include, without limitation, financial projections and estimates and their underlying assumptions, statements regarding plans, objectives and expectations with respect to future production, operations, costs, products and services, and statements regarding future performance. Forward-looking statements are generally identified by the words ‘plans,’ ‘expects,’ ‘anticipates,’ ‘believes,’ ‘intends,’ ‘estimates’ and other similar expressions.

All forward-looking statements involve a number of risks, uncertainties and other factors. Although Consmin’s management believes that the expectations reflected in such forward-looking statements are reasonable, investors are cautioned that forward-looking information and statements are subject to various risks and uncertainties, many of which are difficult to predict and generally beyond the control of Consmin, that could cause actual results and developments to differ materially from those expressed in, or implied or projected by, the forward-looking information and statements contained in this report. Factors that could cause or contribute to differences between the actual results, performance and achievements of Consmin include, but are not limited to, political, economic and business conditions, industry trends, competition, commodity prices, changes in regulation, currency fluctuations (including the Australian dollar and US dollar exchange rates), Consmin’s ability to recover its reserves or develop new reserves, including its ability to convert its resources into reserves and its mineral potential into resources or reserves, and to timely and successfully process its mineral reserves which may or may not occur. Consmin is also exposed to the risk of trespass, theft and vandalism, changes in its business strategy, as well as risks and hazards associated with the business of mineral exploration, development, mining and production. Accordingly, investors should not place reliance on forward-looking statements contained in this report.

The forward-looking statements in this report reflect information available at the time of preparing this report. Subject to the requirements of the applicable law, Consmin explicitly disclaims any obligation or undertaking publicly to release the result of any revisions to any forward- looking statements in this report that may occur due to any change in Consmin’s expectations or to reflect events or circumstances after the date of this report. No statements made in this report regarding expectations of future profits are profit forecasts or estimates, and no statements made in this report should be interpreted to mean that Consmin’s profits for any future period will necessarily match or exceed the historical published profits of Consmin or any other level.