Savannah Resources, the diversified mining group focused on exploration and development of mineral sands in Mozambique and copper-gold projects in Oman, announced yesterday its audited financial results for the year ended 31 December 2015. The Company reported an operating loss of £3.1m (compared with a loss of £1.9m in FY14) mainly attributable to a decrease in the valued of listed investments with an impairment expense of £1.1m and a £0.7m loss on disposal of assets. Net debt for the period totaled £0.1m compared with net cash of £1.5m in FY14. During FY15 the Company raised £1.1m in equity and £1.8m post period and as at 15 February 2016 had a cash balance of £2.0m.
Beaufort Securities view on Savannah Resources: Despite reporting an operating loss of £3.1m in FY15, mostly attributable to a loss on disposal of assets and impairment charges, we note that the Company has a solid cash position and a strong portfolio of assets. During the period, Savannah has made significant progress in defining high-grade Cu-Au zones within Blocks 4 and 5 in Oman and establishing a strategic partnership with Rio Tinto to develop heavy mineral sands in Mozambique. We look forward to continued development of Blocks 4 and 5 with an updated mineral resource estimate as well as feasibility studies regarding potential production of copper concentrate in 2016. In the meantime, we maintain a Speculative Buy rating on the stock.
Beaufort Securities acts as corporate broker to Savannah Resources plc
