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Fluromin, which was formerly known as Maghreb, has put its Witkop mine on care and maintenance because of the weak fluorspar market.
Flurospar is predominantly mined in China, but its exports are reducing. The mineral is used in fluoropolymers, aluminium production and gas for air conditioning and refrigeration. Demand had been rising but global production was falling with limited potential new capacity on the horizon.
Last year, Fluormin bought out the minorities in its Witkop mine in South Africa. Witkop should be able to produce 135,000 tonnes a year but operating costs are higher than the fluorspar price. Fluormin will continue to increase its mineral resources.
Net cash was £7.5m at the end of June 2012. The cash position was helped by non-core disposals. Fluormin has sold its 20% stake in a Kenyan fluorspar mine and is waiting to receive cash of £4.2m.
The net asset value was £22.3m at the end of June 2012 after all mining rights and goodwill have been written off. There is likely to have been a cash outflow since then. At 9.75p a share, Fluormin is valued at £5.5m.
Download the latest AIM Journal from http://www.hubinvest.com/AIMPDFOctober2012_37.pdf
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