Copper 360’s magical week

Copper 360’s share price increased by over 100% in one week – from R2.60 on 23 April 2024 to R5.25 on 28 April 2024.

The share price rally came after Copper 360 released two sets of information – suspected market manipulation of its share price and strong operational projections.

Copper 360 said it picked up unusual trades in its shares, pushing the share price down. It asked the FSCA to investigate these suspicions.

Shortly after this, Copper360 released a statement indicating that it made its first shipment of copper concentrate.

It reported record concentration rates of 30% produced from its newly acquired Nama plant (MFP 2), where it produced 136 tonnes of concentrate over 3 weeks since commissioning.

Copper 360 purchased the MFP 2 plant in March for R200 million. They expect the plant to produce 1,000 tonnes of copper concentrate per month within 3 months.

Since its listing, Copper360 has sold copper at an average price of around R119,000 per ton.

This translates to potential monthly revenue from the MFP 2 plant of R37 million and annual revenue of around R441 million.

Copper360 also said that its MFP 1 plant would be operational by the end of July, and this plant would generate 1,400 tons of copper concentrate each month.

This translates to a potential monthly revenue of R51.4 million at a concentration of 30% – around R612 million per annum.

The company also stated that its SX/EW (Solvent Extraction and Electrowinning) plant could produce around 100 tons of copper per month within the next quarter.

Collectively, based on Copper360’s projections, it would produce around R1.2 billion in annual revenue if it manages to meet its projections.

Since Copper360 announced its first copper concentrate shipment, the share price has popped.

Despite the excitement in the market, Copper360 is still far from meeting these targets. There is a lot of goodwill baked into the promises.

In its latest interim financials, Copper 360’s revenue increased by 189% – from R9 million to R25.96 million.

However, the revenue increase came at a cost. Copper360’s operating loss has deepened from R40 million to R62 million.

The mining company’s interim results further showed that it currently produces just over 400 tons of pure copper on an annualised basis.

It means that Copper 360 still has significant ground to cover to meet its pre-listing target of 15,000 tons of pure copper by 2026.