Katanga Mining Ltd Ord KATFF

RE:RE:One Time Expenses on Q2 Results

[Sogosohubidu201]

The interest charge going forward for KAT will be $429 millions annually or $107 millions quarterly.

The difference between the higher interest of $146 millions in Q2 than previous quarters interest charge of around $103 millions is actually one time event.  It appears that Glencore had re-categorized $2.4 billions customer pre-payment that carried low interest rate of 2-3% in Q2 to long term debt carrying 10% interest, resulting in extra $42 millions interest increase.  After settlement with Gecamines, the long term debt will carry 6-7% interest with average $107 millions interest charge per quarter.