21 January 2016
FOX MARBLE HOLDINGS PLC
(“Fox Marble” or the “Company”)
Pre-close Statement and Operational Update
Increased order book and strong 2016 outlook
Fox Marble, the AIM listed company focused on marble quarrying and finishing in Kosovo and the Balkans region, is pleased to provide an update to the market ahead of its results for the financial year ended 31 December 2015.
2015 reported sales expected to be around €230,000 with the bulk of the existing 2015 order book pushed into H1 2016;
Confirmed orders to date for 2016 are currently €3.5m, for which, as previously announced, an advance payment has been received from Banyan Stone Limited (“Banyan”). This advance payment totals €210,000 in relation to the 2016 order book;
Of the €3.5m, one large order has been received from an import/export company based in the UK for a total of €2m, of which a 30% deposit is expected by 26 February 2016. The balance is payable prior to shipment of this order, expected in Q1 2016;
New long-term distribution agreement entered into with Eboracum Limited, a company based in the north of England through which the above €2m order has already been received;
Continued strategic relationship with Pisani and, in particular, the successful supply of our Sivec and Grigio Argento products into the prestigious Berkeley Homes Chelsea Creek development in London;
Initial order from Banyan delivered in October 2015, which constitutes part delivery on the agreement for which advance payment of €250,000 was received in February 2015. Further orders are anticipated in the first half of 2016;
Further partnership agreements are being negotiated in the Middle East and India;
Sales agency agreement with Zhong Shengdestone Co. Ltd continues to progress. However, delays in ordering have been experienced;
10,700 tonnes of marble were extracted during 2015, lower than the previous year, due to extensive efforts around opening new quarry benches and re-directing production to form larger benches from which more consistent blocks of stone can be extracted, particularly in the Macedonia quarry where we are extracting Sivec marble; and
Commissioning and opening of the factory anticipated by the end of H1 2016, where in-house processed material should be available for direct sale around the world and, importantly, gives the Company access to the local Balkan market for processed stone products. Power and water to supply the processing plant are in place and processing equipment which was previously delayed is now being assembled for delivery and installation in H1 2016. Each major component of the factory has now been purchased or ordered with firm delivery dates.
Cash reserves as at 31 December 2015 were €2.8m; and
- Convertible loan note held by Amati Global Investors Limited that was entered into at the Company's IPO in August 2012 at the initial annual interest rate of 8%, is incurring annual interest at a rate of 25% since 1 September 2015, and maturing in August 2017. The Company is in negotiation to replace this loan note with a long-term loan with a significantly reduced interest rate.
Fox Marble has continued to successfully develop its quarries, which are now all producing quality marble in large compact stone block sizes in Malesheva (Illyric White), Rahovec (grey, red and flora marble), Syrigane (Breccia Paradisea and Etruscan Gold marble) and in the joint venture quarry site in Prilep, Macedonia (White Sivec).
Sales for 2015 were lower than originally estimated due to slower than expected completion of deliveries of our order book as a result of delays in accessing the new Malesheva quarry containing supplies of Illyric White marble, and slower than expected development of our Sivec quarries. We have, however, received significant interest in our material since the Veronafiere exhibition in late September 2015, and have since secured several orders. Due to the timing of these order deliveries, the bulk of the revenue will be reflected in 2016.
Fox Marble anticipates that its order book will now grow at an increasing rate as existing and new distribution channels are developed further, such as the recent distribution agreement with Eboracum Limited. This will be aided by the fact the Company has a sizeable and varied inventory of unique marble for potential customers to review, a requisite for most buyers.
Key objectives for Fox Marble in 2016 will be to complete the factory in Kosovo and to begin selling in-house processed materials. This long-awaited factory will significantly reduce the cost of producing cut and polished marble by minimising the transportation requirement, and this in turn will provide access to new sales channels to local Balkan markets for finished stone, as well as allowing the company to make more efficient use of all of its production.
Chris Gilbert, CEO, commented: “We are pleased to see the increase in our order book due to the hard work of our sales staff and the development of our sales channels. In addition to this, the Company is in negotiation with a number of prospective distribution partners who are active in India, the Middle East and North America. Although 2015 was disappointing in terms of sales, we are starting 2016 with a strong outlook and remain confident in our objective of being a major international supplier of high quality marble.”
For more information on Fox Marble please visit www.foxmarble.net or contact:
Fox Marble Holdings plc
Chris Gilbert, Chief Executive Officer
Tel: +44 (0) 20 7380 0999
Cairn Financial Advisers LLP (Nomad)
Avi Robinson / Liam Murray
Tel: +44 (0) 20 7148 7900
Brandon Hill Capital (Broker)
Tel: +44 (0) 20 3463 5000
Yellow Jersey PR
Tel: +44 (0) 77 6853 7739
Notes to Editors
Fox Marble Holdings Plc is an AIM quoted natural stone extraction Company operating in Kosovo and the Balkans region, with headquarters in the United Kingdom.
The Company has been granted mining licences in relation to six separate marble quarries and completed a maiden JORC resource indicating an in-situ valuation of approximately Euro 16.5 billion. Established in 2011, Fox Marble has access to over 300 million cubic metres of premium quality marble.
Fox Marble also has rights to extract marble from the Drini and Malesheva quarries, both in Kosovo and from the Prilep Quarry in Macedonia.