Mirabela faces uncertain future

Mineral explorer and developer Mirabela Nickel still faces uncertainty as a going concern after coming out of administration in June, on the back of lower than expected nickel prices.

Net profit was $US374 million for the six months to June 30, compared with a net loss of $US69 million for the same period in 2013.

But the company incurred a $US12 million gross loss for the period, with the difference largely driven by forgiveness of a $US395 million series of senior unsecured notes and more than $US40 million in interest.

It required a $US45 million loan to provide liquidity for operations, which accrued fees and interest over the six months to total $US60 million.

The loan was converted to a further series of convertible secured notes, and in late February the company entered administration.

Gross sales were $US95 million, with cost of sales of $US86 million.

The company sold 6,176 tonnes of nickel and 1,998t = of copper over the period, but says the market nickel price is below its break-even position.

Cash costs for production were $US7.85 per pound.

Mirabela’s sole asset is the wholly owned Santa Rita nickel sulphide mine in Brazil, which will have a life of 20 years.

Maryse Belanger commenced as chief executive on June 27 after the resignation of Ian Purdy in May.

Mirabela was up 5 per cent to 10.5 cents per share at the time of writing.