London-listed Tirupati Graphite remains on track to achieve a production rate from the Vatomina graphite project, in Madagascar, of 600 t a month by the end of April, 1 000 t a month by July 31 and 1 500 t a month by December.

The mine produced 375 t of flake graphite concentrate in February, in various grades up to 96% purity, which marks the best month of production in 14 months.

The company shipped 100 t of finished product to customers at the end of February and had 280 t of product awaiting shipment in early March from the Port of Tamatave.

Tirupati has started work on relocating two pre-concentration units from the Sahamamy project, which it also owns in Madagascar, to Vatomina. This will support the further ramp-up in production from the Vatomina project in two months’ time.

The company has secured new orders for deliveries between April this year and March next year, with its current order book standing at 5 780 t at an average sales price of $940/t.

Efforts continue to grow the sales pipeline and average sales prices, especially as Tirupati receives strong inbound interest from multiple long-term buyers for its products.

Tirupati is also implementing a new quality control process that will enhance the group’s production process and improve reliability of plants.

The company currently anticipates completing all shipments that were pre-paid for by customers in 2024 during April. From that point, all sales will benefit current cash flows.

Chairperson Mark Rollins is pleased with the company’s rapid progress since January, especially since the company restarted graphite production on February 1 at the Vatomina project.

He is also confident that the continued implementation of enhanced operating practices under new management is bearing fruit.

FINANCIAL CONDITION

Following turbulence with the company’s prior CEO and the company having been denied access to its accounting systems, Tirupati is busy reconstructing its accounting records, with a new accounting system being implemented.

This process will allow the company to complete and publish its financial statements for the year ended March 31, 2024, as well as interim financial statements for the six months ended September 30, 2024, by April.

Tirupati terminated Shishir Poddar as co-CEO on February 19, with an investigation being ongoing into allegations of misconduct. The company has since appointed Anthony James Nieuwenhuys as sole CEO, and made various senior executive management changes.

Tirupati’s shares on the LSE remain suspended pending completion of the accounts and the related audit, but the company will seek to resume trading of its shares by the end of April.

The company is also in the process of placing and issuing zero-coupon convertible notes, having received commitments of £1.74-million to date.

The notes are expected to convert to ordinary shares of £0.025 par value each in the capital of the company at a conversion price of £0.05 apiece by notice from a holder of the notes or from the company – provided that Tirupati is able to admit the conversion shares to listing.

After the note offering closes, Tirupati will undertake a placing of ordinary shares and use all the proceeds from its fundraising for general corporate purposes and working capital.

Rollins comments that while the financial position of the group is not yet secure, “we are building a firmer footing to move forward towards the goal of becoming a globally significant graphite company, and to capitalise on quickly evolving graphite market dynamics and demand growth from industrial and energy transition market segments”.