Zanaga Iron Ore says industry conditions have discounted progress made in 2014

26th Jun 2015 10:42

Shares in Zanaga Iron Ore fell into the red on Friday after the exploration company said its progress throughout 2014 had been somewhat discounted by changes in the industry, as it posted a jump in annual losses.The group said it reached numerous significant milestones during the year, but that a there have also been a number of negative factors at play."These positive developments have been discounted to some extent by a number of significant changes in the global iron ore industry. A major negative impact has been the substantial fall in iron ore prices due to the slow down in the Chinese economy reducing demand, as well as significant supply increases from the major diversified mining companies."These factors led to the closure of numerous high cost iron ore mining operations globally.Pre-tax losses totalled $164.8m, up from $6.7m in 2013, equal to basic earnings per share of 60 cents, compared to 2.4 cent a year earlier.Major advancements were made with the Zanaga Project during the year, but the market conditions in the global iron ore market affected and continue to affect the raising of finance for the development of the project."Once market conditions stabilise and become more favourable, it is our belief that the Zanaga Project is likely to be in a good position to compete for attracting the finance which is needed to enable a positive constrution decision to be taken," the company said.The company had a cash balance of $12.5m at the 2014 year-end and $10.4m at 31 May 2015.The share price had declined 9.09% to 2.50p by 1057 BST.