Aim-listed Bushveld Minerals’ results for the six months ended June 30 reflect a challenging start to the financial year, as severe funding constraints led to the inability to run its assets efficiently, CEO Craig Coltman says.

However, the company has remained steadfast in its commitment to rationalise assets and implement a range of cost-cutting measures in what is now its core asset, Vametco, he adds.

Bushveld recorded an adjusted loss before interest, taxes, depreciation and amortisation of $14.3-million, compared with earnings before interest, taxes, depreciation and amortisation of $12.6-million for the first half of 2023.

It also recorded an operating loss of $18.6-million compared with a $7.9-million profit in the prior comparable period.

The net loss for the period was $45-million, compared with a net loss of $12.5-million in the prior comparable period.

The sale of the Vanchem vanadium processing plant to Southern Point Resources (SPR) Fund, as previously announced, is expected to be concluded, with approval from the South African competition authorities, by end-October.

Meanwhile, Coltman points out that May was a standout month at Vametco, reaching its highest monthly output since the beginning of his tenure of 217 t, demonstrating the early success of some of the company’s turnaround efforts.

Moreover, Bushveld saw the successful receipt of the final instalment of $2-million from SPR, completing the total $12-million interim working capital facility initially secured in May.

“In a further boost to our position, we received the full $10-million of the matched funding facility from Orion. These milestones have enabled us to maintain momentum in our turnaround journey, but the company remains focused on managing our working capital situation and is dependent on a significant amount of funds from SPR for the balance of funds due in 2024,” Coltman explains.

The group remains focused on optimising operations and rightsizing the organisation to ensure that Vametco is a cash-generating asset.

Bushveld expects to achieve annualised savings of $8-million to $10-million by the end of 2025.

The cost-saving actions include, among other initiatives, reducing the current labour complement at Vametco and head office.

Bushveld is targeting production of 240 t of vanadium a month throughout the remainder of this year.

Bushveld is also working to complete the sale of certain noncore assets, namely Lemur Holdings and Bushveld Electrolyte Company (Belco).

It is in discussions with a joint venture partner for the transfer of liabilities from Belco and removal of a guarantee provided by Bushveld amounting to R28.75-million.

It has also received approval from the Development Bank of Southern Africa to dispose of Lemur, which will result in Bushveld no longer being liable for about $2.5-million in debt. The disposal remains subject to certain outstanding conditions being met.