Champion Iron Posts $253.0 Million In Revenue For Fiscal Q3 2022

Champion Iron Limited (TSX: CIA) reported on Wednesday its financial results for fiscal Q3 2022, earning $253.0 million in revenue. This is a decrease from Q3 2021’s revenue of $329.6 million.

The year-on-year decrease is being attributed to the rising sea freight index due to “rising fuel prices and decreased vessel availability, [and] due to high levels of port congestion in Asian ports.”

Gross margin for the quarter also decreased to 52.4% from last year’s 64.5%. The firm also increased its operating expenses year-on-year to $23.4 million this quarter from $9.1 million during the comparable period last year. The increase is boosted by incurring startup costs related to the Bloom Lake phase II project amounting to $7.2 million.

This leads to the firm notching a net income of $68.0 million for the quarter, also down from last year’s $120.8 million. The quarterly earnings translate to $0.13 per share.

In terms of production, the mining company produced 2,013,200 tonnes of iron ore concentrate during the quarter, up from last year’s 1,922,100 tonnes. Total cash costs and all-in sustaining costs increased during the three-month period to $59.5/dmt and $76.0/dmt from last year’s $56.2/dmt and $64.8/dmt, respectively.

The company also ended the quarter with $468.1 million in cash and cash equivalents. This puts the balance of the current assets at $665.1 million while current liabilities ended at $332.4 million.

The iron firm is currently working on the phase II project aiming to double the capacity of its Bloom Lake property to 15 million tonnes per annum at 66.2% iron. At the end of the quarter, the firm said it still has undrawn available financing of $425.7 million which can fully fund the project estimated to cost $105.5 million towards completion.

Champion Iron last traded at $5.11 on the TSX.

Information for this briefing was found via Sedar and the companies mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

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Author: ER Velasco