Fox Resources Limited today announced its preliminary final results for the 2006 financial year.
Fox Resources Ltd today announced its preliminary final results for the 2006 financial year.
The financial results for the year ended 30 June 2006 reflect the Company's transition from focussed nickel miner to a diversified base metal producer and explorer and the upgrade of the Radio Hill plant to accommodate further production opportunities in the region.
Sales revenue for the year was $29.2 million, up from $26.5 million during the previous 12 month period, an increase of 9.9 per cent. The net loss for the year was $10.6 million (2005: $10.3 million) reflecting an increase in non cash items; depreciation charges of $3.9 million and amortisation charges of $4.8 million.
There were significant changes to the company during the year. Fox re-engineered its balance sheet as a platform from which to drive the Company's new growth phase. All bank debt and hedging has beenretired and a rigorous depreciation and amortisation schedule has been introduced. This combined result significantly allows Fox to take advantage of all its production being sold into the strong metal spot price market.
Important milestones during the 2006 financial year included:
- Upgrade of central treatment facility at Radio Hill
- First copper production from the West Whundo copper-zinc mine
- Exploration success at Ayshia, Shelby and Austin deposits
- Life-of-mine copper offtake agreement and $4 million pre-payment for sales with Jinchuan Group
- The commencement of a Feasibility Study on the processing of disseminated nickel and copper sulphides remaining at Radio Hill
Managing Director Don Harper described the 2006 financial year as a transitional period for Fox but was confident that 2007 would see the company achieve significant profitability.
"Our exploration expenditure was very high during the year, but it has definitely paid off," said Mr Harper. "As a result, we now have West Whundo copper mine providing excellent cashflows and the very prospective Ayshia zinc copper deposit."
The West Whundo copper zinc mine is forecast to produce 4,500t of copper metal in the December 2006 quarter.
"We also discovered a new Volcanic Massive Sulphide system that has the potential to host significant orebodies - results like this are very encouraging and positions us extremely well heading intothe new financial year," he said.
"When reviewing our 2006 figures, it's important to note that the capital expenditures to upgrade the millallows us the option of processing copper from West Whundo, zinc from Ayshia, low grade nickel at Radio Hill, and because of the increased throughput any other deposits that we discover."
"Additionally, the increase in flotation capacity at Radio Hill has enabled better recoveries to be achieved."
The cash balance at 30 June 2006 was $4.9 million. Fox has stated that this cash balance will be sufficient to fund exploration and production development well into 2007.
