This rising star seems to have been overlooked by this board. It is strongly tipped in todays Sun Times as extremely undervalued still with much more interest when it moves to the main list in a few weeks time--straight into the ftse 350. The institutions are coming onboard and I'm happy with my long term hold.

Master rsi you cloud be right i see a brake out coming 49p/50p charts look good

And about time too!

Expected rises on the price of ferrochrome says CEO ...........

20 November 2009
London-listed South African ferrochrome producer International Ferro Metals (IFM) says in a report on page 10 of this edition of Mining Weekly that it expects the ferrochrome price to continue to rise throughout 2010. IFM CEO David Kovarsky expects the upward trend to resume as 2010 kicks off, despite the downturn in demand in the September quarter.

The ferrochrome price is $1,03/lb currently, up from $0,89/lb in the September 2009 quarter, and $0,69/lb in the June quarter. The $1,03/lb price level is expected to persist as Europe and North America adopt it as the benchmark. Though the spot price of ferrochrome has been softer in China, it is expected to firm once Chinese stockpiles normalise.

ferrochrome prices

MRSI. Thanks for info.
The Telegraph rated IFL a buy at 58,so there should be a good deal of mileage here.

The rebound in IFL may have started today (up 3 to 27).If so, it is about time.It could be a good one as it is down well over 50%

This news should,I think ,give the stock a big boost. It is already up a third from recent lows.

21 January 2010




International Ferro Metals Limited

("IFL" or the "Company")




Production report for the three months to 31 December 2009




Highlights:

Production was 57,942 tonnes for the three months to 31 December 2009 ("Q2 FY2010"), up 85%
on the three months to 31 December 2008 ("Q2 FY2009") following the successful start-up of the second furnace in August 2009

Ferrochrome sales volumes were up 61% for the three months under review compared with the previous year, reflecting the suspension of production which took place in November 2008

Ferrochrome inventory was 32,504 tonnes as at 31 December 2009, reflecting management's decision to increase inventory above normal levels

Second furnace started up during August 2009 and both furnaces are now operating at Eskom constrained capacity

Electricity co-generation plant is on schedule and on budget for commissioning during the second half of calendar 2010

Net cash balance of ZAR248 million as at 31 December 2009.




Ferrochrome
Three months to 31 Dec 2009



Three months to 31 Dec 2008



Three months to 30 Sept 2009



Six months to 31 Dec 2009



Six months to 31 Dec 2008




Production tonnes
57,942
31,289
36,773
94,715
90,759

Sales tonnes
34,553
21,410
36,383
70,936
49,435

Stock at period end
32,504
42,523
9,752









Commenting on the operational update, Chief Executive David Kovarsky said:

"Following the successful start up of our second furnace in August 2009, the Company has built up inventory levels in anticipation of higher ferrochrome prices in 2010. So far in 2010, stainless steel production and demand have both strengthened and the management and Board are confident that the Company is well placed to take advantage of a revival in the global stainless steel and ferrochrome markets due to its strong balance sheet, furnaces are running at high utilisation levels, and strong relationships exist with the Chinese market."




Ferrochrome Market Conditions

The revival of the ferrochrome market in August 2009 led the Company to start up its second furnace in the expectation that this trend would continue. Benchmark prices mirrored this expectation with the Q4 2009 European benchmark price increasing to US$1.03 per pound, from US$0.89 in Q3 2009. However due to stainless steel overstocking and, to a lesser extent, an increase of global ferrochrome production and overstocking, this momentum slackened towards the end of Q4 2009. Ferrochrome benchmark and spot prices came under pressure, with the European benchmark price reducing by 2 cents to US$1.01 per pound for Q1 2010.




Metal Bulletin has reported that since the beginning of the calendar year strong Chinese demand for ferrochrome and higher South African costs have resulted in increases in the ferrochrome spot price. Ferrochrome demand in Europe and the USA is also rising although stainless steel production in these markets is improving from a very low base.




In anticipation of future increases in electricity prices and to allow IFL to benefit from future price increases, the Company decided to increase inventory over the quarter under review from the low levels reported at the end of the September 2009 quarter.




IFL's strategic relationship with JISCO, and marketing campaigns to China partnered with JISCO, have historically led to improved customer relationships and a competitive advantage in the Chinese market. IFL intends to continue to focus its marketing efforts on the Chinese market in 2010 as well as supplying its other markets.




Production

Production for Q2 FY2010 (57,942 tonnes) increased by 58% compared with Q1 FY2010 (36,773 tonnes) due to the start-up of the second furnace in August 2009. Production for H1 FY2010 was 4% higher than in H1 FY2009. We are particularly pleased to note that the Company achieved record production for the month of December 2009 of 21,898 tonnes.




Sales

Sales increased from 21,410 tonnes in Q2 FY2009 to 34,553 tonnes in Q2 FY2010 and half year sales increased 43% from 49,435 tonnes in H1 FY2009 to 70,936 tonnes in H1 FY2010. The bulk of sales were made under contract at prices which were higher than those available during the quarter on the spot market.



Inventory

As detailed in the production report and IMS released to the market on 12 November 2009, IFL took steps to rebuild its inventory over the quarter under review from the low levels at the end of September 2009 of 9,752 tonnes to 32,504 tonnes at 31 December 2009 in order to take advantage of the expected increases in ferrochrome and electricity prices.



The current inventory level is higher than the approximately one month's production which the Company would normally maintain.




Capital expenditure

Capital expenditure budgeted for the remainder of the financial year is ZAR304 million which includes ZAR187
million for the electricity co-generation plant and ZAR58 million for mine development. There is no other planned significant capital expenditure and IFL remains focused on controlling costs.




Cash balance

As at 31 December 2009, the Company's net cash balance was ZAR248 million (ZAR448 million cash less ZAR200 million drawn on the ZAR500 million working capital facility), against a net cash balance of ZAR433
million on 30 September 2009. The decrease in net cash was principally due to the build up of finished stock,
and to a lesser extent an increased working capital requirement, planned capital expenditure, and unrecovered overhead.




Outlook

Since the beginning of the year stainless steel production utilisation levels, particularly in China, have
increased. This has had a positive impact on ferrochrome demand and spot prices. This trend is similar to those experienced by other commodities and has been driven by Chinese growth and a stabilisation of other economies. We expect this trend to continue.




The Company is well placed to take advantage of this revival with its strong balance sheet, furnaces running at high utilisation levels, and strong relationship with the Chinese market.




All major capital expenditure projects are running on time and on budget. This will further enhance the Company's production capacity and cost base, ensuring that IFL is well positioned to benefit from improving market conditions.







The Company's interim financial statements for the six months ended 31 December 2009 will be released on
23 February 2010.

Sold out last month at a loss......it's looking better now....

Further good news on top of last months anouncement of quarterly production up by 85%.


17 February 2010



International Ferro Metals Limited
("IFL" or the "Company")



Agreement with Anglo Platinum for chromite supply derived from UG2



The Company has entered into an agreement with Rustenburg Platinum Mines Limited ("RPM"), a subsidiary of Anglo Platinum Limited, whereby IFL will pay approximately ZAR150m for the construction of a chrome re-treatment plant ("CRP") to treat the tailings arising from RPM's UG2 concentrator situated at their Waterval section. The CRP's primary objective will be to extract chromite from the tailings. The CRP will be constructed and commissioned by an EPCM Contractor and owned, maintained and operated by RPM.



IFL will be entitled to 15,000 tonnes of chromite per month (tpm) at no cost other than the cost of transporting the concentrate to its facilities at Buffelsfontein, which is about 50km from the CRP. The 15,000tpm represents almost 30% of the Company's current concentrate requirements and the effective cost of the concentrate will be significantly below the Company's in-house mining cost.



The contract endures for ten years from commencement of the project and IFL is entitled to 15,000tpm from the date of commissioning of the CRP. It is estimated that IFL will therefore receive concentrate for a period of nine years. Construction on the CRP is expected to commence in June 2010 and commissioning is expected to follow 12 months later. The Company will fund the project using existing cash facilities.



David Kovarsky, Chief Executive Officer of IFL commented:



"This is a very exciting and innovative deal for International Ferro Metals and we are very pleased to be partnering with Anglo Platinum, the world's leading primary producer of platinum group metals. This new source of chromite supply for our two furnaces will reduce our input cost and will enable us to better leverage the improving ferrochrome market conditions. This agreement and the start up of the co-gen plant expected in the second half of the calendar year illustrates the management's focus on lowering costs and increasing production capacity."



ENDS




For further information please visit www.ifml.com or contact:



International Ferro Metals Limited

David Kovarsky, Chief Executive Officer

Mob: +27 82 650 1192



Brunswick Group

Carole Cable / Fiona Mulcahy

Tel: +44 (0) 20 7404 5959



Numis Securities Limited

John Harrison / Stuart Skinner

Tel: +44 (0) 20 7260 1000





About International Ferro Metals:

International Ferro Metals produces ferrochrome, the essential ingredient in stainless steel, from its integrated chromite mine and ferrochrome processing operations in South Africa. International Ferro Metals is listed on the London Stock Exchange under the symbol IFL.






This information is provided by RNS
The company news service from the London Stock Exchange

RNS Number : 5158H
International Ferro Metals Limited
23 February 2010











23 February 2010



International Ferro Metals Limited
("IFL" or the "Company")



Interim Financial Results for the half year to 31 December 2009





Highlights

Financial highlights

Sales volumes increased to 71kt, up 35% on the June 2009 half

Higher sales volumes but lower ferrochrome prices and a stronger Rand resulted in

o Revenue of ZAR452m for the December 2009 half, down 14% on the December 2008 half, but up 77% on the June 2009 half

o Loss before tax of ZAR145 millionin the December 2009 half, an increase from the ZAR27 million loss in the December 2008 half but a significant improvement from the ZAR429 million loss in the June 2009 half

Net cash balance of ZAR248 million as at 31 December 2009

No interim dividend to be paid

Operational highlights

Production volumes increased by 4% to 95kt

Rand production costs in line with budget

Second furnace started up during August 2009 and both furnaces are now operating at Eskom
constrained capacity

Ferrochrome inventory was 33kt as at 31 December 2009, reflecting management's decision to
increase inventory above normal levels

Electricity co-generation plant is on schedule and on budget for commissioning during the second

half of calendar 2010



Post period highlights

Innovative UG2 chrome supply contract with Anglo Platinum for 15kt per month expected to reduce
costs

Significantly improved ferrochrome market conditions





Six months to 31 December 2009
Six months to 31 December 2008
Six months to 30 June 2009
% Change between six months to 31 December 2009 & six months to 30 June 2009



(ZAR'000)
(ZAR'000)
(ZAR'000)



Sales revenue
451,917
526,057
255,517
77%

Cost of goods sold
(509,055)
(456,560)
(412,417)
23%

Gross (loss) / profit
(57,138)
69,497
(156,900)
-64%

Loss before tax
(144,842)
(26,809)
(428,970)
-66%

Net (loss) / profit after tax
(105,093)
3,251
(341,830)
-69%

(Loss) / profit per share (ZAR cents)
(19.08)
0.81





Production volumes (tonnes)
94,715
90,759
19,605
383%

Sales volumes (tonnes)
70,936
49,435
52,400
35%










David Kovarsky, Chief Executive Officer of IFL commented:



"With both our furnaces operating at full capacity for most of the half year under review, we were able to increase sales volumes by 35% albeit at a lower ferrochrome price and in a stronger Rand environment. Our Rand denominated costs have now stabilised and we are continuing to manage our inventory and look for further opportunities to increase our margins and production volumes. The announcement of our UG2 chrome supply contract with Anglo Platinum last week illustrates the innovation of the management team and our focus on finding opportunities to reduce costs. The cash on our balance sheet gives us the strength to take advantage of opportunities as they arise."



There will be a presentation to analysts of the interim results today, Tuesday 23 February 2010 at 8.30am (UK time) at 16 Lincoln's Inn Fields, London WC2A 3ED. The presentation slides and a recording of the presentation will be available on the Company's website.



For further information please visit www.ifml.com or contact:



International Ferro Metals Limited

David Kovarsky, Chief Executive Officer

Mob: +27 82 650 1192



Brunswick Group

Carole Cable / Fiona Mulcahy

Tel: +44 (0) 20 7404 5959



Numis Securities Limited

John Harrison / James Black

Tel: +44 (0) 20 7260 1000





About International Ferro Metals:

International Ferro Metals produces ferrochrome, the essential ingredient in stainless steel, from its integrated chromite mine and ferrochrome processing operations in South Africa. International Ferro Metals is listed on the London Stock Exchange under the symbol IFL.



Forward Looking Statements

This announcement contains certain forward looking statements which by their nature contain risk and uncertainty because they relate to future events and depend on circumstances that occur in the future. There are a number of factors that could cause actual results or developments to differ materially from those expressed or implied by these forward looking statements.




Operational and Financial Review



During November 2008 the Company turned off both its furnaces due to the sharp and sudden collapse in ferrochrome demand. In April 2009 one furnace was restarted to convert raw materials to finished product. The market began to show some improvement and the furnace was kept in production after the raw materials conversion campaign ended.



A recovery in ferrochrome market conditions in the second half of 2009 led to the start up of the second furnace, increased sales volumes and significantly improved results over the previous six months. The results however remained markedly below levels reached in the six months to 31 December 2008 ("the comparative period"). The Company reported a loss before tax of ZAR144.8 million for the six months ended 31 December 2009 ("the period") against a loss of ZAR429 million in the previous six months and a loss of ZAR26.8 million for the comparative period.



The average European ferrochrome benchmark price for the period of US$0.96/lb was US$0.99 lower than the US$1.95/lb average price for the comparative period but US$0.20 higher than the previous six months. While ferrochrome production increased by only 4% (to 95kt) from the comparative period, sales volumes increased by 43% to 71kt. The more than halving of ferrochrome prices and the strengthening Rand however resulted in sales revenue decreasing by 14% to ZAR452 million from the comparative period but increasing by 77% from the previous six months.



Production costs in Rand terms were in line with budget and significantly lower than in the comparative period during which coke prices reached record levels, although these savings were partially offset by the increase in electricity prices. The production cost per pound for the period was US$0.80/lb at an average exchange rate of ZAR7.63/$ compared with the Company's forecast made in September 2009 of US$0.72/lb at ZAR8.25/$ which equates to US$0.78/lb at ZAR7.63/$. The constituents of the US$0.80/lb production costs were: ore 22.3c (28%); reductant 22.8c (29%); electricity 14.2c (18%); operating costs 5.2c (6%); fixed costs 11.0c (14%); and depreciation 4.2c (5%).



Administration and other expenses decreased from ZAR196 million in the comparative period to ZAR67 million. This was primarily due to a reduction in both inventory write-downs and unabsorbed fixed costs and the Company's continued focus on controlling costs.



In order to take advantage of the expected increases in ferrochrome and electricity prices, the Company has been rebuilding its ferrochrome inventory from the low levels at the end of June 2009 of 9,362 tonnes to 32,504 tonnes at the end of December 2009.



In July 2009 the Company secured a ZAR500 million three year working capital facility from Bank of China of which ZAR200 million was drawn down as at 31 December 2009. On 3 August 2009 the Company raised ZAR284 million, before expenses, through a share placement, the proceeds of which will be used principally to fund the electricity co-generation plant. The net cash balance at 31 December 2009 was ZAR248 million against a net cash balance of ZAR340 million at 30 June 2009. The ZAR248 million cash is calculated as ZAR395 million cash on balance sheet plus ZAR52 million cash guarantees for the co-generation plant, less the ZAR200 million drawn on the working capital facility.



Operating activities utilised ZAR274 million cash during the period of which ZAR244 million relates to increased inventories of ferrochrome and raw materials. Capital expenditure for the period was ZAR61 million and the budget for the remainder of the financial year is ZAR304 million which includes ZAR187 million for the electricity co-generation plant and ZAR58 million for mine development.



EBITDA loss for the period increased to a loss of ZAR102 million from a loss of ZAR2 million for the comparative period, although this represents a significant decrease from a loss of ZAR394 million for the previous six months. The positive tax charge of ZAR40 million to the income statement is a deferred tax credit resulting from the Company's unclaimed calculated tax losses and unredeemed capital balance available for offset against future profits. Headline earnings per share decreased from a profit of ZAR0.01 per share for the comparative period to a loss of ZAR0.19 per share.



Stainless Steel and Ferrochrome Market Review



The stainless steel market continues to strengthen with European and US utilisation rates increasing significantly in recent weeks, albeit from a low base. Chinese utilisation rates continued at a high level right until the Chinese New Year. Ferrochrome demand has reflected increased stainless steel production and has increased consistently throughout the December 2009 quarter with spot prices increasing in all markets. Market commentators are predicting an increase in the ferrochrome price in the second quarter of 2010.



Over the past twelve months the Company has secured additional long term contracts in Europe and the United States with the objective of placing half of the Company's production under long term contracts. To date one third of IFL's production is under long term contract and it is expected that within six months the balance should be secured. The Company's relationship with major customers in all geographic areas is now well entrenched.



Agreement with Anglo Platinum for Supply of Chromite Derived from UG2



The Company has entered into an agreement with Rustenburg Platinum Mines Limited ("RPM") a subsidiary of Anglo Platinum Limited whereby IFL will pay approximately ZAR150 million for the construction of a chrome re-treatment plant ("CRP") to treat the tailings arising from RPM's UG2 concentrator situated at their Waterval section. The CRP's primary objective will be to extract chromite concentrate from the tailings. The CRP will be constructed and commissioned by an EPCM Contractor and owned, maintained and operated by RPM.



The CRP plant will be capable of producing 50,000 tonnes of chrome concentrate per month and IFL will be entitled to 15,000 tonnes per month (tpm) of chromite at no cost other than the cost of transporting the concentrate to its facilities at Buffelsfontein, which is about 50km from the CRP. The 15,000tpm represents almost 30% of the Company's current beneficiated ore requirements and the effective cost of the concentrate would be significantly below the Company's in-house mining cost.



The contract endures for ten years from commencement of the project and IFL is entitled to 15,000tpm from the commissioning of the CRP. It is estimated that IFL should therefore receive concentrate for a period of nine years. Construction on the CRP is expected to commence in June 2010 and commissioning is expected to follow 12 months later. The Company will fund the project using existing cash facilities.



Mining Operations



The earlier than anticipated start up of the second furnace in August 2009 and a revision of the Lesedi underground mine plan has resulted in the Company having to buy in chrome ore. The Anglo Platinum UG2 concentrate is expected to provide for the shortfall in supply in approximately one year's time and IFL has purchased ore to fulfil its production needs until the UG2 CRP has been commissioned. These requirements have not been fully secured for the next 12 months but the Company is confident that they will be met without a significant impact on overall costs. Because the open pit has significant quantities of low grade ore, the Company will continue to purchase high grade ore to blend with the open pit material. These purchases represent between ten and fifteen percent of ore requirements.



Mining operations were resumed on a limited scale in late 2009 and increased at the beginning of 2010. Most of the focus over the period under review has been on mine development. The negotiations regarding the appointment of a mine contractor are well advanced and it is expected that an appointment should be made by the end of March 2010. The winning contract is expected to be on a fixed cost basis over a three year period with allowances for escalations. Production of ore from the mine is expected to increase significantly shortly after the appointment of the contractor at costs materially below current mining costs.



The Company is reviewing the Sky Chrome mine plan and it is expected that this review will be completed within two months. The application for the Sky Chrome mining licence is proceeding according to expectations and it is expected to be granted by the middle of 2010.



Expansion



The South African electricity crisis in early 2008 and the global economic crisis later that year put a hold on the Company's planned expansion activity. Before those crises it was expected that the company would expand from its current ferrochrome production capacity of 267,000 tonnes per year (tpy) to 665,000tpy. In light of current economic conditions and the anticipated electricity supply increase in 2012 from the Medupi power plant, the Company is conducting pre-feasibility studies on expanding its operations. The feasibility study will include a review of the use of other technologies such as pre-reduction and Direct Current (Plasma) furnaces. All of these technologies include the use of off-gases to generate power on the same basis as the co-generation plant which is expected to be commissioned in the second half of calendar 2010 that will supply the Company with 10% of its energy requirements. The Company is also exploring funding alternatives that range from project finance to joint ventures with stainless steel producers. It is expected that the feasibility studies will be completed by January 2011.



Dividends



The Board of Directors resolved not to declare an interim dividend for the six months ended 31 December 2009.



Outlook



Stainless steel utilisation rates have increased in the US, Europe and China over the past three months driven by restocking in developed countries and growth from fiscal stimulus in China. This has had a positive impact on demand for ferrochrome. Whilst we expect short term demand to remain positive, there may be volatility along the way. However, long term we are confident that demand for South African ferrochrome will remain strong as developing economies continue to urbanise and industrialise and look for diversity and security of supply. IFL will continue to look for and implement innovative ways to preserve margins and expand production in order to adapt to changing market conditions.



The interim financial statements are prepared in accordance with International Financial Reporting Standards (IFRS). An abridged version of the financial statements follows; the full set for the period is available on the Company web site www.ifml.com.




Abridged Financial Statements



Consolidated Income Statement

For the half year ended 31 December 2009







CONSOLIDATED





31 Dec 2009
31 Dec 2008





R'000
R'000










Sales revenue


451,917
526,057

Cost of goods sold


(509,055)
(456,560)

Gross (loss) / profit


(57,138)
69,497










Other income / expenses









Administrative and other expenses


(67,147)
(196,343)

Share-based payment (expense) / income


(2,848)
43,924

Foreign exchange (loss) / gains


(9,608)
49,543

Loss before interest and tax


(136,741)
(33,379)










Finance income


6,540
27,215

Finance costs


(14,641)
(20,645)

Loss before tax


(144,842)
(26,809)










Deferred tax


39,867
31,698

Current tax expense


(118)
(1,638)

(Loss) / profit after tax for the period


(105,093)
3,251










Attributable to:







Non-controlling interests


(1,134)
(864)

Equity holders of the parent


(103,959)
4,115





(105,093)
3,251




























Earnings per share (cents per share)







- basic (loss) / earnings per share


(19.08)
0.81

- diluted (loss) / earnings per share


(19.08)
0.81







Consolidated Statement of Financial Position

At 31 December 2009







CONSOLIDATED





31 Dec 2009
30 June 2009





R'000
R'000










Assets







Current assets







Cash and cash equivalents


395,344
340,089

Trade and other receivables


69,132
81,059

Prepayments


18,553
6,263

Inventories


434,619
195,820

Other current financial assets


52,447
-

Total current assets


970,095
623,231










Non-current assets







Deferred tax asset


106,520
66,653

Financial assets


10,712
8,550

Property, plant & equipment


1,829,698
1,798,151

Intangible assets


9,882
10,062

Other non-current financial assets


22,490
18,234

Total non-current assets


1,979,302
1,901,650

Total assets


2,949,397
2,524,881










Equity and liabilities







Current liabilities







Interest-bearing loans and borrowings


8,959
24,988

Provisions


17,890
12,411

Trade and other payables


138,344
81,010

Total current liabilities


165,193
118,409










Non-current liabilities







Interest-bearing loans and borrowings


265,308
64,053

Provisions


21,017
13,307

Total non-current liabilities


286,325
77,360

Total liabilities


451,518
195,769

Net assets


2,497,879
2,329,112










Shareholders' equity







Contributed equity


3,088,240
2,814,380

Share-based payment reserve


8,272
8,272

Accumulated losses


(593,272)
(489,313)

Non-distributable reserve


(6,044)
(6,044)

Equity attributable to equity holders of the parent


2,497,196
2,327,295

Non-controlling interests


683
1,817

Total shareholders' equity


2,497,879
2,329,112



































































Consolidated Statement of Cash Flows

For the half year ended 31 December 2009







CONSOLIDATED





31 Dec 2009
31 Dec 2008





R'000
R'000










Cash flows from operating activities







Receipts from customers


464,033
805,706

Payments and advances to suppliers and employees (inclusive of goods and services tax)


(724,030)
(1,109,570)

Phantom options exercised and paid


(427)
-

Interest paid


(13,530)
(17,534)

Net cash flows utilised in operating activities


(273,954)
(321,398)










Cash flows from investing activities







Payments for property, plant & equipment


(60,772)
(103,785)

Restricted cash payments


(58,157)
-

Interest received


6,540
27,215

Net cash flows utilised in investing activities


(112,389)
(76,570)










Cash flows from financing activities







Proceeds from issues of shares


286,755
-

Proceeds from borrowings


200,000
200,000

Repayment of borrowings


(21,797)
(6,094)

Payment of share issue costs


(12,895)
-

Payment of share buyback


-
(20,032)

Equity dividends paid


-
(76,148)

Net cash flows from financing activities


452,063
97,726

Net increase / (decrease) in cash held


65,720
(300,242)

Cash at the beginning of the financial period


340,089
972,190

Effects of exchange rate changes on cash


(10,465)
31,875

Cash and cash equivalents at the end of the period


395,344
703,823














This information is provided by RNS
The company news service from the London Stock Exchange

END


IR LLFEAFSIFFII

IN BRIEF:
First half losses piled up at ferrochrome producer International Ferro as a combination of lower ferrochrome prices and a stronger Rand outweighed higher volumes. Revenues fell 14% to R452m for the six months to December 2009, though this was up 77% on the previous six months.

The Questor column in the Telegraph presents a quite positive outlook for IFL.

Questor share tip: Hold International Ferro Metals ferrochrome prices are rising again
Ferrochrome miner International Ferro Metals (IFM) was first tipped by this column at 56p last August but by December, with the shares having lost more than half their value, the tip was labelled an "utter disaster" and its timing "utterly wrong".

By Questor
Published: 7:00AM GMT 24 Feb 2010

International Ferro Metals
International Ferro Metals

33p -2p


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The logic behind the initial tip was that ferrochrome prices, set on a quarterly basis in talks between producers and customers, appeared to be at a bottom, but they fell further.

Questor deemed in December that the shares, with most of the bad news priced in, were worth holding on to, and yesterday, as the company announced interim results, the message from David Kovarsky, chief executive, was that he could see the "light at the end of the tunnel".

IFM mines ferrochrome in South Africa. Between 80pc to 90pc of ferrochrome is used in the production of stainless steel, which is used for a wide variety of purposes from making cutlery to constructing building fades. Stainless steel consists of about 18pc of ferrochrome alloy. IFM is listed in London, although its operations are located in the North West province of South Africa, where the majority of global ferrochrome supplies are found, and the head office is in Sydney.

IFM's results for the half-year to December were a sharp improvement on the depths of the previous half. Sales volumes increased 35pc, revenue rose 77pc to R452m (37.6m), and the loss before tax narrowed from R429m to R145m.

These figures were still significantly lower than those recorded in the second six months of 2008 when revenues were 14pc ahead of the latest data but the upward trend should encourage investors, especially given the difficulties posed by the low ferrochrome prices and a strong rand.

The company appears to have weathered the storm robustly and used the period to take a tighter grip on costs. A partnership with Anglo Platinum, announced last week, will deliver 30pc of IFM's ore requirements at only the cost of transport, while a co-generation plant, due to launch later this year, will allow the company to generate 10pc of its electricity requirement a major cost by harnessing gases that naturally occur during processing.

The key, though, is that Mr Kovarsky referred to a "significantly improved" ferrochrome market with rising stainless steel utilisation rates in Europe, the US and China. Economic recoveries in those areas should help to drive up the ferrochrome price and belatedly deliver the value Questor identified last summer.

"This is the most positive I have felt since October 2008," the chief executive said.

The stock has gained 33pc since the gloom of our December analysis, but investors should hang on for the brighter outlook. Hold.

likely the chinese will take them over.

Halifax
Is there any special reason for this viewpoint?

sp suddenly spurting upwards.

sp up again today towards the close, must be a buyer waiting in the wings.

strong again today up 5%.

This report of a few months back might help explain the situation a little bit.


FERROCHROME
Ongoing ferrochrome price rises expected in 2010 IFM
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By: Martin Creamer
13th November 2009
TEXT SIZE JOHANNESBURG (miningweekly.com) Increases in the price of ferrochrome are likely to be ongoing throughout 2010, says London-listed South African ferrochrome producer International Ferro Metals (IFM).

IFM CEO David Kovarsky expects the upward trend to resume from the beginning of 2010, despite the downturn in demand in the September quarter.

"What the commentators say is that there was an overstocking of stainless steel inventory in China, which was a result of exports into China by Japan, Taiwan, Korea and Europe.

"I think that will ease off by the end of the year and I think that will calm the demand-supply equation," Kovarsky adds.

The ferrochrome price is at $1,03/lb in the December quarter, up from $0,89/lb in the September 2009 quarter, and $0,69/lb in the June quarter.

The $1,03/lb price level is expected to persist as Europe and North America adopt it as the benchmark.

Though the spot price of ferrochrome has been softer in China, it is expected to firm once Chinese stockpiles normalise.

"I think that the Chinese spot price will resemble the benchmark price and commentators are saying that they expect further price increases in the first half of next year," says Kovarsky.

"Although we remain cautious for demand in the near-term, I believe the outlook for stainless steel demand remains intact," says Kovarsky.

IFM started up its second furnace on August 17, after switching on its first furnace on April 20.

"The start up went smoothly and production is now running at full Eskom constrained capacity," Kovarsky said.

On the proposal of South Africa's State-owned electricity utility Eskom to increase its tariff by 45% a year in the next three years on top of this year's 30% increase, Kovarsky says that the tariff would make the South African ferrochrome producers higher cost producers.

But a key aspect is that South Africa, as the largest producer, is generally the price maker and any costs that are increased in South Africa will be built into the selling price, which will have to cater for a higher electricity cost.

Kovarsky doubts whether higher priced product from South African producers would be spurned because of the dependence on South Africa.

"To make up that slack would be extremely difficult. If anything, I think that there is going to be a shortage of capacity in a couple years time because of the constraints that South Africans have on their electricity," Kovarsky adds.

"The first area for the pick up in demand will be China. The Chinese consumption is extremely strong. The three key areas of consumption of stainless steel in China are in construction, infrastructure and automotive and all three are doing well.

"From what we have seen, the destocking should cease by year-end and we should start seeing the pick up of production activity in China and therefore a pick up in demand for ferrochrome.

"I was in the US a couple of weeks ago and although production is relatively low, stainless steel producers are anticipating higher demand. Stainless steel stockists were delaying purchases because of the spike in the nickel price, but the nickel price has since come down and the US expectation is that things are going to pick up in the near future," he says.

IFM is rebuilding its inventory to more normal levels to take advantage of further increases in the ferrochrome price.

Global stainless steel production has increased steadily since the start of 2009 and, although there has been a recent slowdown over the quarter under review, it is expected that the upward trend will resume from the beginning of 2010.

Eloquent IFM chairperson, Tony Grey, quoting Shakespeare, says: "To afford comfort in a time of great stress, Macbeth said, Come what come may, time and the hour run through the roughest day'.

"For the company, the year that has just passed was a period that called for such an observation, Grey says.

The blow of the global financial crisis knocked the ferrochrome producers off balance, but they have slowly got back on their feet, after promptly reducing production.

The scene is now set for better days: "We are now rebuilding inventory to more normal levels to take advantage of any increase in the ferrochrome price and to mitigate against the expected increase in electricity prices in 2010," Kovarsky tells Mining Weekly Online.

IFM produced 36 773 t in the three months to September 30, up from the 18 437 t of the June quarter.

The company's ferrochrome sales of 36 383 t in the September quarter were down 13% on the 41 916 t of the June 2009 quarter, when the company was selling both inventory and production, but 30% higher than the sales in the September 2008 quarter, when the global financial crisis hit.

Continued rand strength is, however, lowered rand-denominated revenue and reduced margins.

Inventory is at a low level of 9 752 t, compared to 9 362 t as at June 30.

Ferrochrome prices are now in excess of $1.30 lb. IFL has double from its December lows,but still well below prices of last summer when it was rated a buy. Performing very strongly again today.SHARES rate them a buy

Ferrochrome production up 48%


27 April 2010



International Ferro Metals Limited

("IFL" or the "Company")



Interim Management Statement incorporating a production statement for the three months to 31 March 2010



Highlights:

Ferrochrome (FeCr) production of 54,394 tonnes (t) for the quarter to 31 March 2010, up 48% on the prior year comparative quarter but down 6% on the previous quarter

Sales of 64,063t for the quarter, up 76% on the prior year comparative quarter and up 85% on the previous quarter. Sales include 15,735t that is subject to pricing revisions based on subsequent benchmark pricing

Inventory of 22,748t at 31 March 2010 (32,504t as at 31 December 2009)

Electricity co-generation plant is on schedule and on budget for commissioning during the second half of calendar 2010

UG2 ore supply agreement concluded with Anglo Platinum which will significantly reduce input costs and extend Lesedi life of mine

Net borrowings of ZAR26 million as at 31 March 2010, principally due to increased working capital requirements (net cash of ZAR248 million as at 31 December 2009)

European benchmark FeCr price increased from US$1.01 per pound in the first quarter of 2010 to US$1.36 per pound in the second quarter of 2010



Ferrochrome
Three months to 31 March 2010

(tonnes)
Three months to 31 December 2009

(tonnes)
Three months to 31 March 2009

(tonnes)

Production tonnes
54,394
57,942
36,773

Sales tonnes
64,063
34,553
36,383

Stock at period end
22,748
32,504
9,752






Commenting on the operational update, Chief Executive David Kovarsky said:

"Stable and improving market conditions resulted in a healthy price increase and good sales growth during the quarter. While production was less than the previous quarter due to variability in the grade of bought in ore feed, we expect these issues to be resolved as mining operations ramp up and for sales and production tonnages to be in line with management forecasts. The Company remains confident that IFL is well placed to take advantage of the continuing improvement in market conditions."




Ferrochrome Market Conditions

Reflecting global stainless steel production growth, the European benchmark ferrochrome price increased by US$0.35 per pound from US$1.01 per pound in the first quarter of 2010 to US$1.36 per pound in the second quarter.



The strong South African Rand continues to impact the Company, but Management are working to control those costs which it can influence, through innovations and measures such as the co-generation plant and the UG2 ore off-take agreement with Anglo Platinum.



Production

Production for the quarter (54,394t) decreased by 6% compared with the previous quarter (57,942t). The lower production was principally due to inconsistencies in the grade of bought in ore feed while underground mining operations are ramped up. Over the last two quarters, IFL has focussed on the development of the underground mine to ensure long term sustainability and the provision of high grade ore. As a result, the output from the mine has declined in the short term. Increasing mine production and the creation of larger stockpiles of bought in ore allowing for improved blending and better ore feed consistency, will result in an improvement of production by July 2010.



Sales

Sales for the quarter to March (64,063t) increased by 85% compared with the previous quarter (34,553t). This included 15,735t sold but which still bears pricing exposure; final pricing for these tonnages will be fixed based on the benchmark price for the quarter in which it is consumed by the customer. It is expected that about 70% will be consumed in the second quarter of 2010 at the higher benchmark price of US$1.36 and the balance in the subsequent quarter, giving IFM the benefit of both having reduced its inventory and providing pricing upside.



Inventory

As announced in February 2010, the Company increased ferrochrome stock levels to higher than the normal level of one month's production in order to take advantage of the then expected increase in ferrochrome prices in the second quarter of 2010. The reduced inventory level of 22,748t at the end of March 2010, from 32,504t at the end of December 2009, reflects 15,735t of sales with ongoing pricing exposure as described above held as a debtor balance at Q1 pricing with an anticipated price adjustment to be accounted for in Q2 and Q3 of 2010.



UG2 Ore Supply

As announced in February 2010, the Company concluded a UG2 ore supply agreement with Rustenburg Platinum Mines Limited ("RPM"), a subsidiary of Anglo Platinum Limited. Under the agreement IFL will pay approximately R150m for a chrome re-treatment plant ("CRP") to extract chrome concentrate from RPM's UG2 concentrator tailings. The contract has a 10 year life commencing on the construction start date and entitles IFL to 15,000t per month concentrate (about 30% of IFL's beneficiated ore requirements) from the commissioning date at an effective cost per tonne significantly below underground mining cost. Construction is expected to start in June 2010 with commissioning in July 2011. The project is to be funded using existing cash facilities.



Capital expenditure

Capital expenditure budgeted for the remainder of the financial year is ZAR218 million which includes ZAR134 million for the electricity co-generation plant, ZAR30 million for mine development and ZAR 15 million for the metal recovery plant, in line with previous announcements.



Cash balance

As at 31 March 2010, the Company's net borrowings were ZAR26 million, against net cash of ZAR248 million at 31 December 2009. The decrease of ZAR274 million was principally due to increased working capital (mostly trade receivables) of ZAR160m and planned capital expenditure of ZAR83m, principally on our co-generation plant and mine development. The Company has a working capital facility of ZAR500m and expects to generate significant operating cash inflows during the quarter ending June 2010, under current market conditions.



Outlook

The demand for ferrochrome has increased over the quarter with corresponding improvement in stainless steel demand, as is reflected in the current premium in the spot ferrochrome price over the contract price. IFL expects this trend to continue as demand from the USA and Europe continues to improve.



Other than as detailed above in this Interim Management Statement, there have been no material events or transactions in the period from 1 January 2010 to 27 April 2010.



- ENDS-



For further information please visit www.ifml.com or contact:



International Ferro Metals Limited

David Kovarsky, Chief Executive Officer
+27 (0) 82 650 1192

Brunswick Group

Carole Cable / Fiona Mulcahy
+44 (0) 20 7404 5959

Numis Securities Limited

John Harrison / Stuart Skinner
+44 (0) 20 7260 1000

RNS Number : 4339L
International Ferro Metals Limited
06 May 2010









06 May 2010



International Ferro Metals Limited

("IFL" or the "Company")



Statement regarding proposed changes to Australian tax regime



International Ferro Metals notes the Australian government's proposal to introduce a uniform resource rent tax to those mining companies with operations in Australia.



As all of IFL's operations and resources are located in South Africa with no mining activities undertaken in Australia, IFL believes, having consulted with its advisors, that it will not be liable for the newly proposed resource rent tax.



- ENDS-



For further information please visit www.ifml.com or contact:



International Ferro Metals Limited

David Kovarsky, Chief Executive Officer
+27 (0) 82 650 1192

Brunswick Group

Carole Cable / Fiona Mulcahy
+44 (0) 20 7404 5959

Numis Securities Limited

John Harrison / Stuart Skinner
+44 (0) 20 7260 1000




About International Ferro Metals:

International Ferro Metals produces ferrochrome, the essential ingredient in stainless steel, from its integrated chromite mine and ferrochrome processing operations in South Africa. International Ferro Metals is listed on the London Stock Exchange under the symbol IFL.



Forward Looking Statements

This announcement contains certain forward looking statements which by nature, contain risk and uncertainty because they relate to future events and depend on circumstances that occur in the future. There are a number of factors that could cause actual results or developments to differ materially from those expressed or implied by these forward looking statements.


This information is provided by RNS
The company news service from the London Stock Exchange