TIDMTGR
RNS Number : 5529I
Tirupati Graphite PLC
08 August 2023
This announcement includes statements that are, or may be deemed
to be, "forward-looking statements". In some cases, these
forward-looking statements can be identified by the use of
forward-looking terminology, including the terms "targets",
"believes", "estimates", "anticipates", "expects", "intends",
"may", "will", "should", "could" or, in each case, their negative
or other variations or comparable terminology. They appear in a
number of places throughout this announcement and include
statements regarding the intentions, beliefs or current
expectations of the Company and the Board. By their nature,
forward-looking statements involve risks and uncertainties because
they relate to events and depend on circumstances that may or may
not occur in the future. Forward-looking statements are not
guarantees of future performance. The Company's actual performance
and results of operations may differ from the forward-looking
statements contained in this announcement.
8 August 2023
Tirupati Graphite plc
('Tirupati', 'TG' or the 'Company')
Q1 FY24 Operational and Business Development Update
Tirupati Graphite plc (TGR.L, TGRHF.OTCQX), the specialist
graphite producer and a supplier of critical minerals for the green
transition economy, is pleased to provide an update on operations
and business development for its flake graphite projects in
Madagascar since the start of this financial year on 1 April 2023
('FY24') and production figures for Q1FY24 (period ended 30 June
2023).
Operations in Madagascar
-- Production ramp-up continues following the completion of the
Vatomina and Sahamamy projects, combined capacity of 30,000 tons
per annum
o development included strengthening of infrastructure to manage
local weather conditions
-- Production for Q1 FY24 was 2,371 tons (Q1 FY23: 822 tons), an increase of 188%
-- Sales for Q1 FY24 were 2,772 tons (Q1 FY23: 803 tons), an increase of 245%
-- The Company remains focussed on reaching monthly production
and sales minimum target of 2,000 tons and expects to achieve this
important milestone in Q3 FY24 having focused this year on:
o Increasing market reach for its products and aligning
operations to meet stringent specifications from clients;
o strengthening both local and expat management teams;
o conducting extensive training for the streamlined processes
developed over the previous year;
o strengthening production processes including water resource
management;
o optimising power generation and fuel supply arrangements;
and
o improving overall efficiencies in both mining and processing
operations to minimise operations downtime and improve head grade
in Vatomina
Market Development
-- Graphite demand growth continues on the back of the energy
transition and is rapidly absorbing China's historical
over-capacity
-- Established graphite buyers are engaging with Tirupati to diversify supply sources
-- The Company has significantly benefitted from its leadership
team's decades of experience in and reputation in the sector,
helping to secure a growing order book and sales
-- As a result, Tirupati is now holding and executing annual
orders with average monthly volumes of c.1200 tons, in addition to
various short-term and spot orders it receives on a regular
basis
-- The order book aligns with the Company's market development
strategy and production estimates allowing optimisation of working
capital
-- Long-term market demand forecasts remain buoyant and are
expected to result in supply shortfalls in the medium-term
Cashflow and Liquidity management
-- Tirupati is managing its operations within the available
resources while ramping up sales and production, and expects to
reach c.50% capacity utilisation in the current quarter and c.75%
in Q3 FY24
-- The Company is tightly managing cash resources following a
period of investment: project development, building infrastructure,
acquiring Suni Resources and building inventory for the expanded
operations
-- Given the strong sales and revenue performance during FY24 to
date, we expect to exceed the production and sales revenue achieved
in the full year FY23 (FY23 GBP2.89m) before the end of August
-- In the meantime, the Company continues to engage in securing
non-dilutive working capital arrangements to improve cash resources
on the back of its strongly improving performance and order
book
Shishir Poddar, Executive Chairman, said:
"We continue to evolve the Company's business to align with our
aim to be a leading player in meeting the growing global needs of
flake graphite, a critical mineral supply of which is identified as
one of the key risks to meeting energy transition targets. Adoption
of electric vehicles is growing globally with the world's largest
economies pushing hard for renewable energy backed transformation
of mobility. While at the current time there is no
supply-deficiency of flake graphite, it is clear from forecasts
that supply will increasingly fail to keep up with the growing
demand.
"We chose the tough but prudent path of refraining from a
dilutive equity raise in the current subdued capital markets,
managing our operations and growth within our available resources.
With the establishment of consistent and growing production we are
progressing to our next target of hitting a positive bottom line at
corporate level in the foreseeable future.
"We will continue to update our shareholders on further
developments and we are confident about both our short and
long-term outlook."
ENDS
For further information, please visit
https://www.tirupatigraphite.co.uk/ or contact:
Tirupati Graphite Plc
Puruvi Poddar - Chief of Corporate & Business admin@tirupatigraphite.co.uk
Development +44 (0) 20 39849894
Optiva Securities Limited (Broker)
Ben Maitland - Corporate Finance +44 (0) 20 3034 2707
Robert Emmet - Corporate Broking +44 (0) 20 3981 4173
FTI Consulting (Financial PR) +44 (0) 20 3727 1000
Ben Brewerton / Nick Hennis / Lucy Wigney tirupati@fticonsulting.com
About Tirupati Graphite
Tirupati Graphite Plc is a specialist flake graphite company and
places a special emphasis on "green" applications of flake
graphite, including renewable energy, and energy efficiency, energy
storage and thermal management and is committed to ensuring its
operations are sustainable as well.
The Company's operations include primary mining and processing
in Madagascar, where the Company operates two key projects,
Sahamamy and Vatomina. With the start of commercial production of
its latest 18,000 tpa plant at Sahamamy in March 2023, it now has
an installed capacity of 30,000 tpa high-quality flake graphite
concentrate with up to 97% purity in Madagascar, planned to
increase to 84,000 tpa as per the Company's modular medium-term
development plan.
On 1 April 2023 the Company completed the acquisition of Suni
Resources SA, Mozambique, whose two main assets are (i) the
Montepuez Project which holds the mining licence over an area of
3,667 hectares with JORC 2012 defined reserves & resources of
almost 120 million tonnes; plus (ii) the Balama Central Project,
which has a mining license over 1,543 hectares with JORC 2012
defined mineral reserves and resources of 33 million tonnes. Both
projects have licenses permitting build out to an annual production
of 100,000 and 58,000 tons of flake graphite respectively.
TG believes that the addition of these projects provides the
Company with sufficient resources to achieve its ambition of
satisfying 8% of the estimated global flake graphite demand - of
around 5 million tons per annum - by 2030.
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END
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