Fortescue has released its Q3 production report:
- Quarterly shipments of 25.9 million tonnes (mt), a four per cent increase from previous quarter and a 61 per cent increase on the previous corresponding period. Full year shipments remain within previously announced guidance of between 127mt and 133mt.
- Iron ore prices strengthened during the quarter, resulting in an average realised cost and freight (CFR) price of US$121 per dry metric tonne (dmt), compared to US$113/dmt in the prior quarter.
- C1 costs continued to decrease and were US$33.17 per wet metric tonne (wmt) in the September 2013 quarter, reflecting lower strip ratios, cost reductions and the devaluation of the Australian dollar.
- First ore on ship was loaded from Fortescue’s fourth berth (AP4) in July 2013, using the third shiploader and third outloading circuit.
- Commissioning of Kings is underway, with first ore to be delivered in November 2013. Sustainable production at the 155 million tonnes per annum (mtpa) rate will be achieved by the end of March 2014.
- Cash balance of US$2.8 billion at the end of the September 2013 quarter reflected strong operational cash flows, rapidly declining capital expenditure and US$470 million of customer prepayments.
- The Iron Bridge transaction was completed after the September 2013 quarter and US$623 million was received by Fortescue in early October 2013.
- Debt reduction programme commenced with the voluntary redemption of A$140 million in preference shares scheduled for November 2013 ahead of final maturity in February 2017.
