Tirupati Graphite FY23 gross profit increased 170% to £1,372,048

Tirupati Graphite plc (LON:TGR), the specialist graphite and graphene company developing sustainable new age materials, has announced its Unaudited Trading Results for the financial year ended 31 March 2023. 

Highlights

·    Gross profit for FY23 increased 170% Year on Year to £1,372,048 (FY22: £508,112)

·    Total production increased by 59% YoY to 4,770 tons (FY22: 2,996 tons)

·    Total Sales increased by 76% YoY to £2,890,010 (FY22:  £1,645,308)

·    Basket price realised per ton of graphite sold increased by 17% to £726 (FY22: £618)

·    A summary of the operating results for the year are as detailed in table below

ParticularsUnitFY 2023FY 2022% Change YoY
Revenue and Sales
Quantity Sold & ShippedMT3,9822,662+50%
Revenue from Sales£2,890,0101,645,308+76%
Price realised£/MT726618+17%
Production and Cost of Production
Quantity ProducedMT4,7702,996+59%
Mining & Processing Costs£ 1,512,563935,604 +62%
Human Resources£ 326,783378,671 -14%
Logistics Utilities & Plant Admin Costs£ 368,061308,278 +19%
(Increase) / Decrease in Inventory£ -689,445-485,357 +42%
Total Cost of Production£1,517,9621,137,196+33%
Cost of Production per ton£/MT318380-16%
Operating Profits & Margins
Gross Profits£1,372,048508,112+170%
Gross Margin % of sales%4731+52%
Cost of Production % of Price realised%4461-28%

Further Overview for FY23

●     Development of new capacities and overcoming bottlenecks faced remained the larger part of the Company’s activities during the year

●     As a result, the Company continued development across its two projects and reached a plant capacity of 30,000 tons per annum (“tpa”).

●     Various measures taken by the Company during the year have been implemented successfully in development and operations with initial impacts becoming visible in the financial results for FY23, these include:

o  reducing operating costs;

o  attaining better ability to overcome adverse weather conditions; and

o  initiating renewable energy generation and the usage thereof.

●     First commercial shipment from the Company’s 18,000 tpa capacity Sahamamy mining and processing facilities was made in March 2023, tailor made to its customer’s requirements.

●     The cumulative investments made in CAPEX by the Company at its projects in Madagascar since inception up to 31 March 2023 now stands at £13.5million, including exploration and evaluation

Demand matrix

·    The global push for climate action and energy transition are resulting in increased consumption of flake graphite in energy storage lithium-ion batteries used in electric vehicles

·    Increasing consumption of flake graphite is also reported in other sustainable development applications like fire safety, thermal management and advanced materials

·    Consumption in conventional applications collectively remains the larger part of global flake graphite usage, though energy transition applications are forecast to overtake these in the near future and are expected to create an inflection point

·    Substantial global dependence for flake graphite on China has created greater interest in the consumer industry for alternative sources

·    The Company is not aware of any other new material production having been established during the year outside China and only a handful of developments other than by the Company are underway in the current year

·    The Company’s products have been exported from origin in Madagascar across three continents during FY23 and the Company remains engaged with the markets accumulating annual orders for its current capacities, and future prospects for its growth plans

Shishir Poddar, Executive Chairman, said:

“We have now completed the first phase of our development into a global leader in this niche speciality material space. In the process, we have successfully managed episodes of extreme difficulty, but have remained firmly focused on our objectives and targets. From the new financial year, we have begun the journey on the next phase, consolidating on what we have achieved and moving forward towards our next targets.

“The stage is now set for us to build a sustainable flake graphite company. Our key differentiator is and remains that we are the only Company that has been founded and managed by a team that specialises in this speciality material, thus helping us to be cost effective as evidenced by our lower capital intensity and operating cost.

“I take this opportunity to express our gratitude to all our investors and on behalf of the TG team, we reiterate our commitment to remain firm on our vision and continue to develop our path to success.”

Tirupati Graphite Plc is a specialist flake graphite company and places a special emphasis on “green” applications of flake graphite, including renewable energy, 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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