Strategic Minerals PLC (AIM: SML, OTC: SMCDF) announced that its Cobre iron ore tailings facility in New Mexico recorded a six-year peak in monthly sales in February.
To manage this increased demand, Southern Minerals Group, a subsidiary of SML, is procuring a Caterpillar Excavator (Trackhoe 320) to handle the growing volume.
The facility processed 4,898 tons in February, marking the highest monthly sales figure since March 2021.
SML noted that a segment of SMG’s customer base includes fertilizer companies, which typically see a seasonal rise in demand during February and March. This surge in sales volume is a positive indicator for the year’s prospects.
Consequently, SML is projecting quarterly sales to average around 13,000 tons post-March 2024, with expected Cobre revenue for 2024 being US$3.5 million, as per AIM-listed SML’s forecast.
Shares of #SML tripled during January – February and today’s update underlines why in the form of the 6-year high for the sales tonnage. It does appear that the stock will be able to resume the big turnaround. @ZaksTradersCafe Share Price is currently sitting c0.28p (+21.68%)⤴️ https://t.co/EI0VFohStf pic.twitter.com/iZvtJKKJqW
— Share_Talk ™ (@Share_Talk) March 7, 2024
The company is optimistic about sustaining these elevated sales levels, significantly higher than the past three years.
John Peters, Managing Director of Strategic Minerals, stated: “The promising sales in February 2024, coupled with the anticipated return to about 13,000 tons in quarterly sales, point to a strong cash flow for the end of 2024, following the settlement of 2023’s creditor dues.
“The enhanced management at Cobre has effectively tackled the challenge and recently added a Trackhoe 320 to our equipment lineup, ensuring continued high-volume operations despite challenging weather. This equipment was not only sourced locally but also fully financed, aligning the repayment schedule with our future cash flow projections.
“Moreover, we are in ongoing talks with another potential major client at Cobre. However, with the recent upturn in activities, these discussions are now more focused on securing supply for future years.”
