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Bushveld Minerals Ltd on Tuesday said it has begun to launch cost-cutting initiatives and development works to restore the company to profitability. The Vanadium producer operating the Vanchem and Vametco processing facilities in South Africa said its decision to launch turnaround initiatives was driven partly by global market conditions, but also by the company’s recent decision to focus on its core operating asset, Vametco. It will dispose of its downstream energy assets, including the Mokopane development project and Vanchem. Bushveld plans to reduce the current labour complement at both Vametco and its head office; reduce costs by transferring purchases of certain goods and services to longer-term contracts; reduce raw material consumption by ensuring assets are running efficiently; begin several initiatives for yield improvements from kiln to finished goods, improving production on a fixed cost base, as well as increase the capacity of the Barren Dam at Vametco in the first quarter of financial 2025. Bushveld expects its initiatives to potentially achieve savings between $8 million and $10 million by the end of 2025. It will also continue to prioritise sales in higher-value markets, such as nitro vanadium in North America. Bushveld announced on September 2 it had received $10 million in matched funding from OMF Fund III Ltd, which would provide the working capital to reduce long outstanding creditor balances and allow management to focus on reducing costs and sustainably increasing current production rates at the company’s core asset. Chief Executive Officer Craig Coltman said: ‘These initiatives are vital to ensure a sustainable long-term business for the benefit of all stakeholders, from those that work at and live near the mine, and to those that have provided the vital funds required for Vametco to stay in business within this prolonged, weak pricing environment.’ Shares in Bushveld Minerals were down 5.7% to 0.54 pence each in London on Tuesday afternoon. Copyright 2024 Alliance News Ltd. All Rights Reserved.
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