(Incorporated in Hong Kong with limited liability)
(Stock code: 1029)
FIVEFOLD INCREASE IN REVENUE
NET PROFIT OF US$113 MILLION
A teleconference call to discuss the results will be held today at 14h00 Hong Kong time. The number is +852 2112 1888, the passcode is 4582527#. A replay of the conference call will be available at www.ircgroup.com.hk by 28 March 2018. Presentation slides are available www.ircgroup.com.hk.
HONG KONG, March 27, 2018 /PRNewswire/ -- The Board of Directors of IRC Limited ("IRC" or the "Company", together with its subsidiaries, the "Group") is pleased to announce the annual results of the Company for the year ended 31 December 2017.
KEY HIGHLIGHTS
Financials
- Net profit of US$113.3 million (31 December 2016: Net loss of US$18.2 million)
- Fivefold increase in revenue to US$109.3 million (31 December 2016: US$16.5 million)
- Cash cost reduced by 12.0% to US$48.4 per tonne (31 December 2016: US$55.0 per tonne)
- K&S generated an EBITDA of US$32.9 million (31 December 2016: N/A, as K&S was not in commercial production)
- Impairment reversal of US$129.6 million following operational status and correction in market conditions
Operations
- K&S' 2017 production capacity of c.50%; currently at about 70% and increasing
- Sales volume increased 6 times to 1,539,146 tonnes (31 December 2016: 219,352 tonnes)
- Achieved selling price doubled to US$78 per tonne (31 December 2016: US$39 per tonne)
- K&S' customer base broadened and diversified
- Care and maintenance process at Kuranakh satisfactory
Commenting on the results, Jay Hambro, Chairman of IRC said, "It is with great delight that we can report a substantial net profit of US$113 million for 2017. I am very glad that K&S is finally delivering the value that has been long awaited. Moreover, when the mine reaches its full capacity in 2018, it will fulfil its promise to be one of the most exciting and low cost iron ore operations in the world. Current market conditions have also allowed us to better reflect the underlying asset strength of the operation in reporting an annual profit that is more than half of our entire market capitalisation.
Commenting on the results, Yury Makarov, Chief Executive Officer of IRC said, "2017 has been a year of profit turnaround and positive operating margin for IRC. We are glad to witness our K&S mine entering into the commercial production, signifying its transformation from a developing project to a cash generating mine. During the year, K&S produced over 1.5 million tonnes of iron ore concentrate to generate an EBITDA contribution of US$32.9 million. The mine is currently operating at around 70% capacity and is on track to produce at full capacity soon after the remaining bottlenecks are resolved. With the strengthened Sino-Russian relationship and the Belt-And-Road initiatives, we believe commodities producers like IRC would benefit when the infrastructure projects and commodities demand pick up along the new "Silk Road". Given that the Far East of Russia is one of the strategic points for the Sino-Russia Economic Corridor, K&S is well-situated to enjoy this geographical advantage. Finally, we would like to thank our team, shareholders and stakeholders for their continuous support."
The board of directors of IRC Limited (the "Board") is pleased to announce the audited results of the Company and its subsidiaries (collectively referred to as the "Group") for the year ended 31 December 2017, which have been reviewed by the Company's Audit Committee, comprising of independent non- executive directors, and by the external auditor. The Board has authorised the Executive Committee, which comprises of the Executive Directors and senior management of the Company, to approve the annual results on its behalf.
To access full report, please click on the following link: http://www.ircgroup.com.hk/attachment/201803270206401738165190_en.pdf
PUBLICATION OF FINAL RESULTS AND ANNUAL REPORT
This results announcement is published on the websites of The Stock Exchange of Hong Kong Limited (www.hkexnews.hk) and of the Company (www.ircgroup.com.hk). The annual report of the Company for the year ended 31 December 2017 containing all the information required by the Listing Rules will be dispatched to the Company's shareholders and published on the above websites in due course.
By Order of the Board
IRC Limited
Yury Makarov
Chief Executive Officer
Hong Kong, People's Republic of China
Tuesday, 27 March 2018
As at the date of this announcement, the Executive Directors of the Company are Mr Yury Makarov and Mr Danila Kotlyarov. The Non-Executive Directors are Mr George Jay Hambro, Mr Benjamin Tze For Ng, and Mr Chi Kin Cheng. The Independent Non-Executive Directors are Mr Daniel Bradshaw, Mr. Chuang-Fei Li, Mr Simon Murray, CBE, Chevalier de la Légion d'Honneur, Mr Jonathan Martin Smith and Mr Raymond Kar Tung Woo.
IRC Limited
6H, 9 Queen's Road Central Hong Kong
Tel: +852 2772 0007
Fax: +852 2772 0329
Email: ir@ircgroup.com.hk
Website: www.ircgroup.com.hk
For further information please visit www.ircgroup.com.hk or contact:
Kent Lo
Manager - Communications & Investor Relations
Telephone: +852 2772 0007
Mobile: +852 9688 8293
Email: kl@ircgroup.com.hk
SOURCE IRC Limited
