MTT Metal-Tech

 

TIDMMTT 
 
RNS Number : 4450D 
Metal-Tech Ltd 
02 December 2009 
 

2 December 2009 
 
 
Metal-Tech Ltd 
('Metal-Tech' or 'the Company') 
 
 
Trading Update 
 
 
Metal-Tech Ltd., the metal-based hydrometallurgy and chemical company, which 
focuses on the recycling and production of specialty metals powders such as 
Tungsten and Molybdenum, provides the following trading update. 
 
 
Further to the announcement of the interim results on 18 September 2009, the 
Company has continued to experience low demand during the second half of 2009, 
due to the impact of the slowdown in global economic conditions on end markets, 
such as automotive, drilling, aviation, cutting tools, construction and 
engineering, in which Metal-Tech's  customers' products are used. 
 
 
Metal prices have remained low during the period and the Company's Mongolian 
plant is still not in operation and shall remain so until a more favourable 
financial climate and conditions arise. Metal-Tech remains in negotiations with 
its Mongolian partner to secure suitable terms for the resumption of supply in 
raw materials to the Company's Mongolian operations. 
 
 
Notwithstanding the continued suspension of its Mongolian operations, management 
expects full year revenues to be broadly in line with market expectations, the 
Company having been able to replace expected Molybdenum revenue with increased 
Tungsten sales, albeit at lower margins. Falling metal prices, along with the 
Company's continued success at reducing inventory levels have also resulted in 
lower than market anticipated margins. 
 
 
As stated at the time of the interim results, Metal-Tech has taken important 
steps to adjust to the current economic climate by managing its operational 
costs. The Company continues to be actively engaged in cost reduction measures 
in all aspects of its business, to improve efficiency, while maintaining its 
customers and the capacity to secure new business opportunities that arise as a 
result of the continued turmoil in the sector. 
 
 
The Company continues to focus on cash generation including the reduction of 
inventory levels as well as the working capital invested. Accordingly as at 24 
November 2009, the net cash balance of the Company was $9.2 million (23 July 
2009: $11 million) which is sufficient to meet the Company's current financing 
costs and expected operating expenses. While there has been a focus on cash 
generation the Company expects its financial expenses to exceed market 
expectations for the year to 31 December 2009, principally as a result of 
exchange rate movements and higher interest rates. 
 
 
The Company expects to provide a further update for shareholders in early 2010. 
  Enquiries: 
+-------------------------------------+-------------------------------------+ 
| Metal-Tech Ltd.                     |                                     | 
+-------------------------------------+-------------------------------------+ 
| Ariel (Aik) Rosenberg, Chairman     | +972 544 215454                     | 
|                                     |                                     | 
+-------------------------------------+-------------------------------------+ 
|                                     |                                     | 
+-------------------------------------+-------------------------------------+ 
| Panmure Gordon                      | +44 20 7459 3600                    | 
+-------------------------------------+-------------------------------------+ 
| Edward Farmer, Stuart Gledhill      |                                     | 
|                                     |                                     | 
+-------------------------------------+-------------------------------------+ 
|                                     |                                     | 
+-------------------------------------+-------------------------------------+ 
| Corfin Communications               |                                     | 
+-------------------------------------+-------------------------------------+ 
| Harry Chathli, Alexis Gore          | +44 20 7977 0020                    | 
+-------------------------------------+-------------------------------------+ 
 
 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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