Western Areas Announces Half Year Financial Results and FY17 Guidance Upgraded - Seite 3

"Western Areas set in place a management plan for FY17 with a view to maintaining a strong financial position and priority given to maximising cash generation rather than raw production volume. Successful implementation of this plan in the first half has resulted in A$28.1m free cashflow generated post all capital expenditure, tax, royalties and corporate costs," said Mr Lougher.

"Despite 1HFY17 nickel sales being 1,077 nickel tonnes lower than 1HFY16 (but ahead of guidance), the Company generated a further A$10.7m in EBITDA which in part is a reflection of the improved nickel price but also dedicated cost management."

"All of this has been achieved by our workforce which has not wavered or been distracted by the external challenges. The Company has now operated without a LTI for 1,057 days and we continue to innovate in areas such as blasting techniques, nickel sulphate marketing potential and industry leading nickel offtake contracts."

"The Company took decisive action in August 2016 when announcing the deferral of capital expenditure and some exploration activities into the first half of FY17. Following this period of consolidation, we have now re-commenced normal development activities at both mines in line with plan."

"With over A$100m in cash at bank and no debt, I believe the Company is exceptionally placed to weather external policy changes and nickel price volatility. Importantly the second half will see the impact of much improved offtake terms, further exploration results at Cosmos and the completion of the pre-feasibility study at Odysseus," said Mr Lougher.

FY17 Guidance
Metric	Updated FY17 Guidance	Original FY17 Guidance
Mine Production (Nickel tonnes in Ore)	25,000 to 26,000	22,500 to 24,500
Nickel tonnes in Concentrate Production	22,000 to 23,000	20,200 to 22,000
Unit Cash Cost of Production (Ni in Conc.)	A$2.35/lb to A$2.50/lb	A$2.40/lb to A$2.75/lb
Sustaining Capex*	No Change	A$22.0m to A$24.0m
Forrestania and Regional Exploration	No Change	A$8.0m
Odysseus PFS	No Change	A$2.0m
*Includes one-off ventilation shaft at Spotted Quoll for A$6.0m in the 2ndhalf of FY17

Western Areas is pleased to upgrade certain guidance metrics for FY17. A number of improvement projects were implemented at the beginning of the year to achieve the strong first half improvements in grade (particularly at Spotted Quoll) and ore recovery compared to original forecasts. The Company also delivered higher ore grades than Reserve which had a flow on impact into mill production and unit cash costs.