NTU’s Stock Slipped On ASX Post Release Of Brown Range Project Update

NTU’s Stock Slipped On ASX Post Release Of Brown Range Project Update

Northern Minerals Limited (ASX: NTU) is an exploration company. It is into the exploration and evaluation of rare earth minerals. Its flagship project includes Brown Range Project that is rich in Heavy Rare Earth (HREs) hosted in xenotime mineralization. The company works on heavy rare earths projects and has a target to be the next significant dysprosium producer outside of China via its Brown Range Project.

On 21 December 2018, the company announced that it is progressing on the Browns Range project as per its expectations. Brown Range is an initial-testing project in the East Kimberley region of Western Australia. Following the release, the share price of the company decreased by 10.714% on December 21, 2018.

As per the terms of the EPC construction contract between the company and Sinosteel MCC, the practical completion of the construction phase of the R&D Pilot Plant Project is determined as of 24 October 2018.  The payment of $10.2m (ex GST), is deferred. The company will pay this deferred cost in 5 quarterly instalments starting on the date 12 months after Practical Completion.

As per the Managing Director and CEO of the company George Bauk, the company is continuing to progress as it is setting goals at Browns Range. The company is targeting to ship its first product from the Pilot Plant before the end of the year. The company took the opportunity to recognise the excellent work done by Sinosteel MECC on the construction and delivery of the Browns Range R&D Pilot Plant.

Recently, the company has issued 13.020 million fully paid ordinary shares through a private placement to a nominee of Lind Asset management. The company has also recently entered into a subscription agreement with JHY Investments PTY for the issue of 4 million convertible shares divided in two tranches with a face value of A$1.00 per note.

The company total revenue stood at $4.56 million in FY18 as compared to the restated number of $3.70 million in FY 2017. The company incurred an operating loss of $18.78 million in FY 2018 as compared to $12.56 million in FY 2017, however, the net loss for the year stood at $18.497 Mn in FY 2018 million as compared to $ 13.195 Mn in FY 2017.  The balance sheet for the year end recorded an increase in total assets by more than 2.5 times approximately with the number standing at $101.23 million in FY 2018 as compared to $27.946 million in FY 2017. The company had an outflow of cash from operations in FY 2018 with an amount of $15.05 million as compared to $4.97 in FY 2017, whereas the cash outflow from investing activities stood at $29.78 million in FY 2018 as compared to $11.33 million in FY 2017.

Let us now quickly look at the stock performance and the return of Northern Minerals that it has generated over the past few months. The stock price of company ended the session at A$0.050 per share which represents that the stock has encountered the fall of A$0.006 per share. The market capitalization of Northern Minerals Limited stood at circa $66.52 million.

In the span of previous one month, the stock has delivered the return of -22.54%.


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