Shares in copper and tin miner, Metals X have fallen to historical lows after appointing Canaccord Genuity and Hartleys to review the company's copper mines including the Nifty and Maroochydore projects.
The 2019-20 interim results for Metals X look like being stained with red ink after a gloomy trading update and downgrade on Wednesday and the 33% plus plunge in the share price on Wednesday got it right.
Nearly 300 jobs will go after Copper miner Metals X says it will immediately suspend operations at its Nifty Copper Mine in the eastern outback of Western Australia (near where Newcrest’s Telfer gold and copper mine is located and the recent copper, gold and silver strike by Rio Tinto).
The company's re-set plan for Nifty provides a path to profitability and is split into two phases over three years. Production and costs are below Macquarie's forecasts, which drives a weaker earnings outlook.
Production at both Nifty and Rennison was slightly below Macquarie's estimates. Nevertheless, the broker is encouraged by the fact the company has opened up mining stopes outside the central zone at Nifty, which has resulted in an improvement in the grade.
FY17 profit was weaker than Macquarie expected. The pending upgrade to reserves at Nifty is expected to underpin a 7-8 year mine life, while near-mine and extension drilling may materially upgrade assumptions for the project.