Resource Stocks Apply Brakes on Operations to Comply with Local Authorities’ COVID-19 Actions- SYR, JMS, CSD, and AZS

  • Mar 25, 2020
  • Team Kalkine
Resource Stocks Apply Brakes on Operations to Comply with Local Authorities’ COVID-19 Actions- SYR, JMS, CSD, and AZS

The COVID-19 pandemic outbreak has prompted many resource stocks to put a hiatus on their operations to comply with the local and international authorities measure, aimed at containing the spread. The global economy is in danger with manufacturing, services, and many more sectors taking a hit due to weak or non-existent demand.

To Know More, Do Read: Gold Stocks Becoming Investors’ Favourite? Depreciating Currency and Brighter Gold

However, the whole world seems to be coming together to deal with this outbreak and ASX-listed resource companies are adopting measures, deemed fit for containing the spread and preserving the shareholders’ equity.

Also Read: A Brief Look at How the World Is Coming Together to Mitigate the Coronavirus Impact

The ASX-listed resource stocks such as Syrah Resources Limited (ASX:SYR), Jupiter Mines Limited (ASX:JMS), South32 Limited (ASX:S32), and many more, who operate overseas are also complying with the local authorities, where they operate their business for providing sustainability to the business and bring shareholders under the net of confidence.

ASX-listed Resource Stocks Adopt Necessary Measures to Contain the COVID-19 Spread

  • Syrah Resources Limited (ASX:SYR)

Syrah temporarily suspends Battery-Anode Material Project in the United States

SYR mentioned in an announcement on 24 March 2020 that the Company is implementing protocols and procedures to ensure the safety of its workforce and to manage potential operational risks emerging to its operation from the coronavirus outbreak.

The Company also mentioned that it would keep following the advice of Government in the jurisdictions in which SYR operates and is vigilant with respect to the latest information.

SYR mentioned that the Governor of Louisiana issued a state-wide “Stay at Home Order” on 22 March 2020, in order to contain the COVID-19 spread, effective from 5 p.m. (GMT-5) Monday, 23 March 2020 to 13 April 2020.

The Company also informed that its plant in Vidalia in Louisiana, USA does not come under exemption under “Stay at Home Order”, which prompted SYR to temporarily put a break on its plant, which, as the SYR assesses, would delay the distribution of purified natural graphite samples for qualification with potential customer.

SYR also informed that the Balama Graphite Operations in Mozambique is operational, and it would monitor the international mobility of personnel, the free movement of goods through supply chains and broader market conditions.

SYR reiterated its end of quarter cash balance expectation of USD 64.6 million and it believes that this level of liquidity along with recently implemented cost restructure would allow the Company to thoroughly manage an extended period of uncertainty. 

SYR last traded at $0.257, up by 11.74 per cent against its previous close on ASX (as on 25 March 2020, AEDT: 3:06 PM).

Jms lockdowns Tshipi Borwa manganese mine as South African Government places 21 days halt

JMS notified the shareholders about the lockdown declared by the South African Government, which would be in place for 21 days to contain the COVID-19 spread, starting 26 March 2019, Thursday midnight.

JMS suggested that the lockdown would bring its Tshipi Borwa Manganese Mine in purview and mentioned that the Board of the Company would evaluate the obligations soon and would also assess the effect on the business.

Jupiter is not the only resource company, whose operations fall under the purview of the lockdown, the Richards Bay Minerals prospect operated by Rio Tinto Limited (ASX:RIO) also comes under the purview of lockdown, where Rio has decided to curtail the production and put furnaces on maintenance and care.

However, few resource companies such as South32, whose operations are falling into the essential list is exempt from the South African 21 days lockdown.

To Know More, Do Read: Four Iron Ore Stocks Under Positive Territory Amidst Market Turmoil-  RIO, FMG, CIA, and S32

The stock of the Company last traded at $0.210, up by 7.69 per cent against its previous close on ASX(as on 25 March 2020, AEDT: 3:06 PM).

CSD puts the Mount Garnet and Surveyor Project operations into care and maintenance

CSD suggested that it is putting the Mount Garnet and Surveyor Project operations onto care and maintenance as at close of business today, Tuesday 24 March 2020 amid public health concerns surrounding the COVID-19 pandemic.

The Company is further developing and implementing various plansto ensure the health of its employees and normal operations; however, the final timeline of the plan is yet unknown as the Australian Commonwealth and State government are changing guidelines constantly.

CSD further anticipates that the restarted operations would consist of operation of the Dry River South Mine only, while the Mount Garnet Processing Plant would be operational on campaign processing schedule.

The trading of CSD stock on account of announcement Auctus agreement, it last traded at $0.125 per share(as on 25 March 2020, AEDT: 3:06 PM).

AZS suspends drilling activities and all field exploration across prospects.

AZS provided an update related to its Mexican operations andstated that in the wake of COVID-19 outbreak, which continues to cause a highlevel of global uncertainty and volatility, the Company would suspend its drilling and all field exploration across prospects.

AZS further suspended the trial processing program of high-grade ore from Oposura with the bulk concentrates bagged into bulker bags which have been stored in the Company’s warehouse and has demobilised field crews.

AZS also believes that the prevailing environment also requires a diligent focus on capital expenditure and management of the balance sheet; thus, the Company has implemented salary reduction between 25 to 40 per cent for directors and senior executives along with deferring certain payouts for a period of the next six months.

The Company has trimmed the size of the technical team in Mexico, which coupled with a resignation of Mr Gleen Jardine (ex-CEO) has reduced the overall payroll. Apart from that, AZS is now using third-party contractors and consultants, which has considerably reduced discretionary expenditure.

AZS suggested that these actions were taken by the Board of the Company to immediately reduce the cost and curb the cash outflows during amidst market uncertainty, which would further ensure the protection of Azure’s high-quality assets.

However, the Company believes that with the latest discovery of the Gregors copper prospect at the Alacrán Project, which is a flagship prospect of the Company, it is exposed to a new and exciting challenge ahead.

Now, a slimmed-down technical team would undertake a data review alongwith an assessing the result for the resumption of field activities, once business environment permits.

The stock of the company last traded at $0.051, unchanged as against its previous close on ASX(as on 25 March 2020, AEDT: 3:06 PM).


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