Bushveld lives to mine another day after bail out
By Brendan Ryan
July 3, 2024
https://www.miningmx.com/top-story/57376-bushveld-lives-to-mine-another-day-after-bail-out/
Excerpt
ENBATTLED vanadium producer Bushveld Minerals has survived to fight another day thanks to negotiating a revised financing deal with major supporter the OMF Fund 111 (Orion).
But the company is far from out of the woods as it faces a critical working capital and debt situation having lost $106m in the year to end-December at which date it had just $1.3m in cash and total borrowings of $98.6m.
Asked by an investor on a conference call on Tuesday what Bushveld’s chances of survival were until the end of 2024 CEO Craig Coltman replied: “You would have seen in the accounts that we passed the going concern test to the end of June 2025 and that has been signed off by the auditors.
“But that’s if our assumptions pan out including that we meet production levels as planned and that the vanadium price does not drop any further.”
In reply to a follow-up question on whether Bushveld could become a profitable business if the vanadium price remained at current dollar levels Coltman replied: “No. We cannot have a sustainable business at the current price.
“It’s not the EBITDA (earnings before interest, tax, depreciation and amortisation) that is going to keep you going because you need sustainable capital expenditure in the order of four to five million dollars. And that’s normalised capital. We will probably do double that this year because we are playing catch up.”
Coltman said he expected vanadium prices to start increasing within 12 months, commenting: “It’s a matter of when rather than if. Estimates we have indicate prices could start moving up from quarter four this year or quarter one next year.”.....