Press releases

MDM project pipeline shift

MDM's audited results

21 June 2011

MDM Engineering Group Limited (AIM:MDM) (“MDM Engineering” or “MDM” or “the Group”) is pleased to announce its audited results for the full year ending 31 March 2011. MDM Engineering is an African-focused engineering and project management company which provides a range of value-adding services to the mining industry, including project evaluation, process engineering, design and project management.

Highlights

Financial: 

  • Revenue of US$ 20.8 million (2010: US$ 33.2 million)
  • Gross profit of US$ 5.2 million (2010: US$ 10.1 million) 
  • Pre-tax (loss) / profit of US$ (2.1) million (2010: US$ 5.0 million)
  • Return to profitability in H2 with a pre-tax profit of US$ 0.4 million
  • Strong cash position of US$ 17.8 million (2010: US$ 10.0 million) with negligible gearing
  • Basic (loss) / earnings per share of US (3.89) cents per share (2010: US 9.25 cents)
  • Full year dividend of US 3.50 cents per share (2010: US 4.60 cents)
  • Commitment to pay 50% of after-tax profits as a dividend to shareholders

Operational: 

  • Kalagadi Manganese engineering and project management (“EPCM”) contract was awarded in October 2010, providing a base of chargeable man-hours for the next two years.
  • MDM was awarded the front end engineering and design (“FEED”) for a 3,6 million tonne per annum (“tpa”) platinum project near Rustenburg in South Africa with the intention of fast tracking the execution phase later in the 2011 calendar year.
  • Awarded a Bankable Feasibility Study for a 2,4 million tpa tailings treatment process plant by African Barrick Gold.
  • Secured the Kinsenda (Metorex Limited) Bankable Feasibility Study (“BFS”) in September 2010.
  • First Uranium’s Mine Waste Solutions (“MWS”), Chemwes Phase 2 gold project resumed in August 2010, after being suspended in February 2010, which was completed ahead of schedule and within budget.
  • Gold Fields West Wits tailings retreatment plant BFS was completed in September 2010.
  • MDM was awarded carbon in leach (“CIL”) secondary crushing project for Goldfields Ghana Limited at their Tarkwa mine in November 2010, with detailed engineering completed before year end.
  • MDM formed a key strategic alliance with Perth-based GR Engineering Services Limited.

MDM Engineering Chief Executive Officer, Martin Smith commented:

"MDM has begun to secure a significant order book which should enable it to return to profitability in FY2012. The financial year ending 31 March 2011 was plagued with market uncertainty caused by the global financial crisis, resulting in a reduced workload and operating loss for the first six months of the financial year.
 
This calendar year there has seen an improvement in commodity prices which has assisted in the increase of expressions of interest received relative to last year. This has had a positive impact on our order book during the first two months of the new financial year. We are therefore optimistic that this upward trend will continue for the foreseeable future, and given the volume of large-scale mining projects being undertaken on the African continent, that our leading expertise will continue to attract increasing demand.”

The financial information that follows does not constitute the Group’s annual report for the year ended 31 March 2011 or 31 March 2010. The auditors have reported on the financial statements and their report was unmodified.

About MDM Engineering:
MDM is focussed on providing premium value added services to its clients, establishing itself as a market leader in the junior and mid-cap mining space in Africa. MDM has in the past achieved a very high success rate of converting studies into execution projects. The Board believes that MDM has a robust business model, is financially sound and is set to continue with its positive earnings in the 2012 financial year as seen over the last six months of the current year under review. Due to its positive cash balances, current execution projects, increased pipeline, order book and continued growth prospects, the Board has decided to declare a final dividend of US 3.00 cents per share payable on the 28 July 2011 to all share holders registered on the share register on 1 July 2011.

Financials and Chairman's Statement (PDF)

Key Information:

MDM Engineering Group Limited is a minerals process and project management company focused on the mining industry. The Company provides a wide range of services from preliminary and final feasibility studies, through to plant design, construction and commissioning. To date, the Company's clients have largely been junior and mid-tier mining corporations with operations in Africa.

The MDM Engineering core technical team has a 23 year track record of completing a wide range of studies and execution projects across a variety of minerals, including precious metals, base metals, ferrous and non-ferrous metals, uranium and diamonds.

The Company has adopted an approach to project execution based on an open-book Engineering, Procurement, Construction Management ("EPCM" or ";cost-plus") basis. With a core focus on Africa, MDM Engineering is setting the benchmark standard for best practice in the mining services industry through its commitment to providing the highest quality services and actively engaging with clients to ensure maximum transparency.

Enquiries:

MDM Engineering Group Limited

Martin Smith (CEO)
George Bennett (Executive Director)
Dominique de la Roche (Finance Director)
Tel: +27 (0) 11 993 4300

Collins Stewart Europe Limited

Adrian Hadden
John Prior
Tel: +44 (0)20 7523 8350

Tavistock Communications Limited

Paul Youens
Emily Fenton
Tel: +44 (0)20 7920 3150

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