ALPHAMIN Resources, a major producer of tin, which operates in the Republic of Congo, yesterday flagged an increase in core profit boosted by metal prices for its first quarter to the end of March.
The miner has a primary listing in Toronto and a secondary JSE listing.
Its core profits rose to a record $98 million (R1.43 billion), up 32 percent compared to the previous quarter, the company said in an operational update for the quarter ended March 2022.
While ore processed fell by 2 percent quarter on quarter to 105 565 tonnes to the end of March, prices rose 14 percent to $43 813 per tonne.
"Underground mining continued to deliver steady results, and processing plant recoveries increased to 78 percent from 75 percent the previous quarter," Alphamin said.
The group said its vision is to become one of the world’s largest sustainable tin producers.
"From a capital allocation perspective, the board considers the combination of investment in growth, significant exploration, and a high dividend yield a robust value proposition," it said.
The group said its dividend distributions would be considered semi-annually based on excess free cash after taking into account the capital funding requirements for the new Mpama South Mine expansion project recently announced.
On March 29, the company announced an updated resource for Mpama South and its decision to commence with development.
"Mpama South’s development is expected to increase annual contained tin production from the current 12 000tpa (tonnes per annum) to 20 000tpa, approximating 6.6 percent of the world’s mined tin. The first tin production from Mpama South is targeted to start in December 2023," the group said.
The group's Mpama North mine is the world’s highest-grade tin resource, with Alphamin stating that it is about four times higher than most other operating tin mines.
The company said exploration activity continued to be a focus area.
Expansionary and infill drilling expenditure of $20m was planned for the full year 2022.
“To date, approximately 85 percent of drill holes completed intercepted visual tin mineralisation," it said.
In 20201, tin prices rose due to Covid-19 pandemic lockdowns, which led to supply chain challenges.
Lockdowns strengthened the demand for home electronics, all containing tin solder, and simultaneously disrupted a small, globally concentrated supply base, the company said.
China also played a part in the rise of tin prices as it faced production constraints due to an energy crunch and environmental crackdowns by authorities. The invasion of Russia in Ukraine also sent metals prices to skyrocket this year. Tin hit a record of $48 650 a tonne in early March.