29/01/2018 - 14:39

Atlas repays $20m in debt

29/01/2018 - 14:39

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Perth-based Atlas Iron has repaid $20 million of debt to reduce its term loan to less than $85 million, while also continuing to pursue diversification opportunities in copper and lithium.

Atlas repays $20m in debt
Cliff Lawrenson said the decision to reduce the debt was in line with the company’s strategy to re-position the business. Photo: Attila Csaszar

Perth-based Atlas Iron has repaid $20 million of debt to reduce its term loan to less than $85 million, while also continuing to pursue diversification opportunities in copper and lithium.

Atlas managing director Cliff Lawrenson said the decision to reduce the debt was in line with the company’s strategy to reposition the business.

“Following this $20 million repayment, we will have reduced our debt from more than $180 million in June 2016 to less than $85 million – cutting our interest cost by about $8 million a year,” he said.

“After evaluating other financing alternatives, we concluded that a staged repayment of the term loan is the best option for the company to preserve liquidity while strengthening our balance sheet.

Meanwhile, the company said a recent geological reconnaissance program at its Pancho project had confirmed that several pegmatites has the potential to hold lithium.

“Analytical results from surface rock chip sampling show several of the targets have geochemistry that confirms they are lithium-caesium-tantalum style pegmatites that have the potential to host lithium enrichment,” the company said.

“Compilation of these results along with other information gathered in the field has enabled Atlas to define a specific zone of focus for the next stage of exploration work.”

A drilling program at Atlas’s Copper Range project also provided promising results.

“With up to nine kilometres of historically anomalous copper and gold results along the length of the Copper Range project, Atlas believes there to be excellent potential for a large scale, low grade copper deposit to be defined, with opportunity to discover smaller higher grade massive sulphide lenses,” Atlas said.

The company said its attempts at conglomerate-hosted gold exploration had slowed following changes in market sentiment late in 2017.

Shares in Atlas finished down 16 per cent at 2.6 cents each.  

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