Katanga Mining Ltd Ord KATFF

Q3 Financials

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Q3 financials are out as is yet another "speedbump". Read below: "Copper revenue increased to $246.3 million in Q3 2018 from $204.4 million in Q2 2018. Copper revenue increased to $597.2 million in Q3 2018 YTD from $(0.2) million in Q3 2017 YTD. Cobalt revenue increased to $181.8 million in Q3 2018 from $141.1 million in Q2 2018. Cobalt revenue increased to $323.0 million in Q3 2018 YTD from nil million in Q3 2017 YTD. The increase in copper and cobalt revenue for both periods relates to an increase in sales of copper cathode and cobalt contained in hydroxide due to the resumption of production in December 2017 following the completion of phase 1 of the whole ore leach project and the on-going ramp-up of production in 2018". https://www.newswire.ca/news-releases/katanga-mining-announces-third-quarter-financial-results-700550321.html This is the new latedt "soeefbump" encountered. The PR states: "DGDA Instruction Preventing Imports and Exports: The DGDA issued an internal instruction on November 9, 2018, temporarily preventing KCC from importing or exporting any material or production, including copper production, as a result of KCC's alleged failure to declare and pay duties on the export of at least 6,650 tons of copper in December 2014 and January 2015. Both before and after the issuance of the internal instruction, KCC has continued to produce copper at normal levels and is in discussions with the DGDA with a view to resolving the matter and resuming imports and exports. The dispute with the DGDA arose as a result of the Company's previously disclosed overstatement of copper cathode production by 6,650 tonnes in December, 2014. This overstated cathode production was provisionally invoiced in the amount of $43 million on December 31, 2014. However, as disclosed in the Company's restated consolidated financial statements for the years ended December 31, 2016 and 2015, the restated financial statements eliminated the recording of the overstated cathode production and the provisional invoicing of $43 million. Although the 6,650 tonnes of copper cathode at issue were not produced by KCC in 2014 or exported in 2015, the DGDA claims that KCC failed to pay export duties on the export of these copper lots. The DGDA proposes to levy export duties and significant penalties on KCC as a result of the alleged failure to pay export duties. Given that the copper cathode production at issue did not exist and that the copper lots were not exported, KCC strongly asserts that no export duties are owing on the overstated (not produced and not sold) copper cathode. As indicated above, KCC is engaged in discussions with the DGDA with a view to resolving the dispute". These are my views only. Thanks for reading.