REG - Harvest Minerals Ltd - Full Year 2023 KP Fértil® Sales & 2024 Guidance

Harvest MineralsAnnouncement

15/02/2024 13:15

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RNS Number : 3187D  Harvest Minerals Limited  15 February 2024

Harvest Minerals Limited / Index: LSE / Epic: HMI / Sector: Mining

15 February 2024

Harvest Minerals Limited ('Harvest' or the 'Company')

 

Full Year 2023 KP Fértil® Sales Performance and 2024 Guidance

 

Harvest Minerals Limited, the AIM listed fertiliser producer, provides the
following update on its 2023 performance and 2024 guidance in respect of sales
of its organic, multi-nutrient, direct application fertiliser, KP Fértil®,
from its 100% owned Arapuá Fertiliser Project in Brazil ('Arapuá').

 

OVERVIEW

§ Orders to the end of December 2023 totaled 34,880 tonnes, of which 28,707
were invoiced in the same calendar year, and the remaining will continue to be
invoiced through Q1 2024.

o  As at this date, the Company has been paid for 27,024 tonnes of the above
invoiced amounts

§ 7,067 tonnes of orders have been placed up to this date in 2024, of which
1,250 tonnes invoiced.

§ Fertilizer demand expected still to be challenging in 2024 but signals of
improvements, especially in the coffee sector, gives Board confidence to set
2024 sales guidance of 70,000 tonnes of placed orders.

§ Cash position as at end 2023 of c. US$630,000

§ Company has implemented a cost reduction exercise to reflect reduced
activity.

 

Brian McMaster, Chairman of Harvest, said: "2023 started with a sharp drop in
fertilizer prices, political changes, and along with it, a decrease in the
value of agricultural commodities, mainly soybeans, which is the country's
largest agricultural crop. All of this created a scenario of many
uncertainties. Although soybean prices remain low, fertilizer values began to
stabilize since the end of 2023, bringing a little more predictability and to
our particular advantage, coffee crops in our target region are expected to
have a year of growth. We have already started the year by booking meaningful
orders, and the sales team is signaling positively for this year's goal of 70k
tonnes.  The Company has implemented sharp cost reductions while it has kept
key commercial efforts and renewed strategy to reap the benefits of an
expected better market in 2024."

 

FURTHER INFORMATION

 

2023 / YTD 2024 Sales at Arapuá Fertiliser Project

In 2023, Harvest received new orders totalling 34,880 tonnes for its KP
Fértil® product produced at its Arapuá Fertiliser Project in Brazil, of
which 28,707 were invoiced by end of the year and the remaining orders are
being invoiced through Q1 2024. Regrettably, approximately 8,469 tonnes of
placed orders at the end of September of 2023 were cancelled by clients in the
last quarter of the year due to unforeseen operational and financial issues
with such clients.

 

Orders to date in early 2024 have amounted to 7,067 tonnes, or 20% of the
total volume of 2023. While the market prospects are still uncertain, the
coffee crops in our target regions are signaling for a modest growth and we
are positioned to reap the benefits of an increased volume of fertilizer
orders.

 

Update on 2022 invoice collection

Cash is gradually being received upon delivery for the total of orders
invoiced in 2022. At the end of 2023, approximately 11,620 tonnes have been
delivered. We continue to work with customers which have placed the orders in
2022 but which have not yet agreed to take delivery of the product from our
storage facility. We have also started to seek ways to legally enforce the
deliveries. As a reminder for Shareholders, accounting regulations that the
Company is subject to require delivery of the product to have occurred for
revenue to be recognised in the financial statements.

 

Financial position

At the end of 2023, the Company's cash position was R$3.1 million
(approximately US$630,000), including about a third held as cash collateral
with financial institution.

 

Harvest has implemented a sharp cost reduction exercise across all its
departments, especially in the commercial and mine operations activities, in
order to reflect reduced activities. Approximately 50 per cent. of the mine
workforce has been let go once sufficient product inventory had been built up,
together with a cut back in agronomic trials and exploration activities.
Additionally, all director fee payments have been suspended since mid 2023.

 

Outlook

Given the historic expectation that approximately 80% of sales are seasonally
placed in the second half of the year and, factoring in the orders placed up
to the date of this press release, we are setting a guidance target of 70,000
tonnes to the year of 2024 and will keep the market informed of the
performance as we advance the year.

 

 

**ENDS**

 

For further information, please visit www.harvestminerals.net
(http://www.harvestminerals.net/)  or contact:

 

 Harvest Minerals Limited            Brian McMaster (Chairman)   Tel: +44 (0) 203 940 6625

 Strand Hanson Limited               Ritchie Balmer              Tel: +44 (0) 20 7409 3494

 Nominated & Financial Adviser       James Spinney

 Tavira Securities                   Jonathan Evans              Tel: +44 (0) 20 3192 1733

 Broker

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulation
(EU) No. 596/2014 as it forms part of United Kingdom domestic law by virtue of
the European Union (Withdrawal) Act 2018, as amended by virtue of the Market
Abuse (Amendment) (EU Exit) Regulations 2019 ("UK MAR").

 

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