05/01/2017 - 16:01

Atlas pays off $54m of debt

05/01/2017 - 16:01

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Mid-tier iron ore miner Atlas Iron has repaid $54 million of debt to reduce its term loan to $118 million, amid expectations in will be in a net cash position by the middle of the 2017 calendar year.

Atlas pays off $54m of debt
Atlas expects to be in a net cash position by the middle of the year.

Mid-tier iron ore miner Atlas Iron has repaid $54 million of debt to reduce its term loan to $118 million, amid expectations in will be in a net cash position by the middle of the 2017 calendar year.

The company finished the quarter with cash on hand of $135 million, up from $95 million at the end of September.

Every dollar of cash on hand in excess of $80 million is repaid to lenders under the company's term loan facility.

The move came after making principal and interest payments of $20 million during the December 2016 quarter and $3 million in repayments to the state government in relation to the royalty relief program.

Atlas interim managing director Daniel Harris said there had been a remarkable turnaround at the iron ore miner since its restructure, which was approved by shareholders in April 2016.

“Atlas is now on track to be in a net cash position by the middle of this year,” he said.

“This markedly stronger balance sheet will help make Atlas more resilient and better-placed to capitalise on its opportunities, including the development of the Corunna Downs project.”

In November, Atlas flagged it hoped to be in production at the Corunna Downs mine by March 2018.

That would come as operations at the existing Wodgina and Abydos mines come to an end in late 2017 and early 2018 respectively.

The company's other mine, Mt Webber, has at least seven years of reserves remaining, while a capacity expansion is under way to lift production from 6 million tonnes per annum to 7.8mtpa by the September quarter of this year.

Shares in Atlas were unchanged at 2.7 cents each at the close of trading.

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