Afarak Group Plc - Quarterly report

Afarak Group : 3rd Quarter Results

07:00 London,  09:00 Helsinki, 11 November 2016 - Afarak  Group Plc ("Afarak" or
"the Company") (LSE: AFRK, NASDAQ: AFAGR) Interim Report

AFARAK GROUP PLC'S UNAUDITED INTERIM REPORT FOR 1 JULY - 30 SEPTEMBER 2016

Q3 HIGHLIGHTS (July-September 2016):

Afarak  displayed resilience in the  face of a challenging  quarter and is well-
positioned to benefit from the current market upswing.

Health, safety & environment
  * One worker, Nelson Maurison Msimango, succumbed to grievous injuries
    sustained followed at accident at Mogale plant


Investor highlights
  * Capital redemption of EUR 2.6 (0.0) million approved and paid during the
    quarter

Financial highlights
  * Revenue decreased by 35.4% to EUR 28.9 (Q3/2015: 44.8) million
  * EBITDA was EUR -2.8 (Q3/2015: 1.3) million and the EBITDA margin was -9.8%
    (Q3/2015: 2.8%)
    EBIT was EUR -4.5 (Q3/2015: -0.7) million and the EBIT margin was -15.7%
    (Q3/2015: -1.5%)
  * Profit for the period from continuing operations totalled EUR -3.2 (Q3/2015:
    -1.0) million
  * Cash flow from operations was EUR -5.5 (Q3/2015: 9.9) million and liquid
    funds at 30 September was EUR 7.0 (30 September 2015: 22.3) (30 June
    2016: 13.2) million

Operational highlights
  * Processed material sold decreased by 11.7% to 18,023 (Q3/2015: 20,419)
    tonnes
  * Production of processed material decreased by 4.4% to 18,489 (Q3/2015:
    19,348) tonnes
  * Tonnage mined decreased by 64.2% to 45,487 (Q3/2015: 127,004) tonnes



                           +------+     |       +--------+        |      +-----+
 KEY FIGURES (EUR million) |Q3/16 |Q3/15|Change |Q1-Q3/16|Q1-Q3/15|Change|FY   |
                           |      |     |       |        |        |      |2015 |
---------------------------+------+-----+-------+--------+--------+------+-----+
 Revenue                   |28.9  |44.8 |-35.4% |109.2   |138.5   |-21.2%|187.7|
---------------------------+------+-----+-------+--------+--------+------+-----+
 EBITDA                    |-2.8  |1.3  |-326.0%|1.2     |13.5    |-91.0%|17.2 |
                           |      |     |       |        |        |      |     |
 EBITDA margin             |-9.8% |2.8% |       |1.1%    |9.8%    |      |9.2% |
---------------------------+------+-----+-------+--------+--------+------+-----+
 EBIT                      |-4.5  |-0.7 |       |-3.7    |8.1     |      |9.9  |
                           |      |     |       |        |        |      |     |
 EBIT margin               |-15.7%|-1.5%|       |-3.4%   |5.8%    |      |5.3% |
---------------------------+------+-----+-------+--------+--------+------+-----+
 Earnings before taxes     |-4.2  |-2.0 |       |-4.6    |6.1     |      |6.5  |
                           |      |     |       |        |        |      |     |
 Earnings margin           |-14.6%|-4.5%|       |-4.2%   |4.4%    |      |3.5% |
---------------------------+------+-----+-------+--------+--------+------+-----+
 Profit   from   continuing|-3.2  |-1.0 |       |-4.5    |7.0     |      |7.8  |
 operations                |      |     |       |        |        |      |     |
                           |      |     |       |        |        |      |     |
 Profit  from  discontinued|1.0   |0    |       |1.5     |0       |      |0.8  |
 operations                |      |     |       |        |        |      |     |
---------------------------+------+-----+-------+--------+--------+------+-----+
 Profit                    |-2.2  |-1.0 |       |-3.0    |7.0     |      |8.5  |
                           |      |     |       |        |        |      |     |
 Earnings per share, basic,|-0.01 |0.00 |       |-0.01   |0.03    |      |0.03 |
 EUR                       |      |     |       |        |        |      |     |
---------------------------+------+-----+-------+--------+--------+------+-----+

Commenting on the third quarter results, Alistair Ruiters, CEO, said:

"The  company endured a  very challenging quarter.   It was extremely painful to
deal  with the  loss of  one of  our colleagues,  Nelson Maurison  Msimango, who
passed  away following a fatal accident at  our Mogale plant.  We are continuing
with our efforts to enhance health and safety procedures at our plants.

Markets  remained subdued as prices for many  of our products continued to slide
accompanied  by tapered demand.    With prices gravitating  downwards, our sales
volumes  in  the  speciality  alloy  segment  were  hit  hard.   Our  mining and
production  volumes were lower due  to safety stoppages at  our mines and due to
the  closure of Mogale Alloys plant following the fatality.  In response, Afarak
focused  its efforts on  prudent working capital  management, the procurement of
strategic raw materials at competitive prices and debt collection.  Our sales of
materials,   particularly  charge  chrome,  remained  satisfactory  despite  the
seasonality associated with weak demand in the third quarter.

We  are seeing  a recovery  in prices.  Benchmark prices  for charge chrome have
accelerated  and  demand  is  gaining  traction.  This improved market sentiment
together  with our strong managerial  and production capabilities should further
support our efforts to generate value for our shareholders."

Disclosure procedure

Afarak follows the disclosure procedure enabled by Disclosure obligation of the
issuer (7/2013) published by the Finnish Financial Supervision Authority, and
hereby publishes its Q3/2016 unaudited interim report enclosed to this stock
exchange release. The Interim Report is attached to this release and is also
available on the Company's website at www.afarak.com.

Investor Conference Call
Management will host an investor conference call in English on 11 November 2016
at 14.00 Finnish time, 12.00 UK time. Please dial-in at least 10 minutes
beforehand, quoting the reference: 38313.

Finnish number +358 (0) 800 774 579
UK number +44 (0) 844 229 0 900

AFARAK GROUP PLC
Alistair Ruiters
CEO

For additional information, please contact:

Afarak Group Plc
Alistair Ruiters, CEO, +358 50 372 1130, alistair.ruiters@afarak.com
Melvin Grima, Finance Director, +356 2122 1566, melvin.grima@afarak.com
Jean Paul Fabri, PR & Communications Manager, +356 2122 1566,
jp.fabri@afarak.com

Financial reports and other investor information are available on the Company's
website: www.afarak.com.

Afarak Group is a chrome mining and minerals producer focused on delivering
sustainable growth with a Speciality Alloys business in southern Europe and a
FerroAlloys business in South Africa. The Company is listed on NASDAQ Helsinki
(AFAGR) and the Main Market of the London Stock Exchange (AFRK).

Distribution:
NASDAQ Helsinki
London Stock Exchange
main media
www.afarak.com

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulations
(EU) No. 596/2014 ('MAR'). Upon the publication of this announcement via
Regulatory Information Service ('RIS'), this inside information is now
considered to be in the public domain.



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Attachments:

Q3 RESULTS EN.pdf