Still suffering the effects of an underwater mining accident that damaged its NamSSol seabed crawler early in the year,
The loss, which translates into 1 per share, is greater than the US$$665,000 loss (1 per share) incurred in the year-ago period. Cash flow from operations sank to negative US$9 million from a positive US$1.7 million between the two periods, while direct production costs nearly doubled, to US$8.2 million from US$4.4 million. The higher costs reflect the startup of the MV Ya Toivo vessel and an increase in vessel charter rates.
For the first nine months of 2001, Namco’s loss amounted to US$26 million (35 per share), a significant turnaround from year-earlier earnings of US$2.6 million (6 per share). Revenue slid to US$10.2 million from US$31.2 million between those two periods, while the number of carats sold was more than halved to 68,000 from 175,800.
In the third quarter, 28,100 carats diamonds were produced, well off the 65,000 carats recovered a year earlier. The 9-month total was 52,600 carats, down from 163,500 carats.
The sale of 30,600 carats generated US$4 million in revenue during the recent third quarter, down from US$9.3 million on the sale of 58,100 carats a year earlier. The drop is attributed to four factors: lower diamond prices for smaller stones; commissioning of MV Ya Toivo; limited contribution from the MV Namibian Gem vessel; and lack of production from MV Kovambo. During the quarter, the Leviev Group, Namco’s largest shareholder, began exclusively marketing the company’s diamond production.
MV Ya Toivo, the support vessel to the Nam2 mining system, performed below expectations, owing to delays in resource delineation and unspecified technical obstacles.
In September, MV Zacharias resumed drill sampling on mining licence 51, following several technical delays early in the quarter. By the end of September, 31 samples, each measuring 5 sq. metres, had been taken with the drilling system, and 42 were completed using the airlift system. So far, Namco has confirmed that mineralization extends for about 1 km south of mined areas in Feature 019 and the adjoining Feature 018 of licence 51. A 1,100-sq.km area contains some 200 geological features targeted for testing.
Since the end of the quarter, Namco has begun sampling feature 5 in licence 36A in an area known as Bakers Bay. Ongoing sampling indicates potential for a significant mining area.
In Late September, the junior was granted another month to restructure its debt. The moratorium, which has yet to be ratified by Namibian’s credit insurers, means that repayments on US$21.2 million in outstanding loans will begin at the end of November. The rescheduling terms have yet to be specified.
At the end of September, the company had US$2.4 million in cash and US$48.9 million in bank debt.
Namco has 18,000 sq. km in total, most of which contains geological features that have been surveyed only regionally.
Be the first to comment on "Seabed explorer Namco still struggling"