Pyx Resources Limited (NSX:PYX) Operations Update H1 2021

PYX Resources Ltd (NSX:PYX) has performed strongly in the first half of the year due to a boost in premium zircon production, sales volume growth, and ongoing price increases. During H1 2021, the Company raised its premium zircon selling price three times, resulting in a US$355 per tonne price increase during the first six months of the year.

The price increases reflect the general lack of premium zircon supply globally due to continued supply issues in South Africa and low inventory levels in China, while reduced Australian sales of Heavy Mineral Concentrate (HMC) to China have created a further void of premium zircon in the market, leading to higher customer demand and, consequently, higher market prices. Indonesian zircon prices have now reached their highest price point since 2013.

Oliver Hasler, Chairman and Chief Executive Officer, commented: "I am delighted with our achievements during the first half of 2021. The mineral sands industry is currently experiencing a strong upcycle, and market conditions are now ideal for the implementation of the Company's growth strategy. This comprises developing our newly acquired Tisma deposit so that production can get underway soon. As the world strives to resolve the climate crisis, it is becoming more apparent that electric vehicles and renewable energy will rely on increased supplies of metals like zircon."

In H1 2021, PYX sold 3,250 tonnes and produced 3,501 tonnes of premium zircon, resulting in a year-on-year production increase of 25%. Sales volume has shown a strong year-on-year growth of 14%, while maintaining a tight finished goods inventory. Customer demand continues to increase and show particular interest in PYX's zircon due to its low aluminium oxide (AI2O3) of under 0.2%. In addition, the uranium + thorium content of PYX's zircon is less than 450ppm, making it ideal for producing fused zirconia, the unique end product, which can be used for a wide range of applications due to its very high melting point, chemical stability at high temperature, hardness, corrosion resistance and high refractive index.

In February 2021, the Company completed the acquisition of Tisma in Central Kalimantan, Indonesia, converting PYX into the second largest producing mineral sands company globally in terms of JORC-compliant zircon resources. This acquisition was an excellent strategic addition to PYX's resource base and a milestone in the consolidation of the Indonesian mineral sands mining business, and was highly accretive for the Company. Planned capacity increases will enable the Company to meet further global demand, increase margins, and grow market share.

To this purpose, in June 2021, the Company completed a US$8.4m placement to fund a capital expenditure and working capital programme at Tisma to ramp-up production of 65.5 grade premium zircon.

In March 2021, the Company announced that it had entered into a 3,600 tonnes two-year binding Offtake Agreement with India-incorporated Microtech Zircon, a member of Delta Tiles, a group of companies which fall under the brand name Geo Gres.

On 25 May 2021, the Company announced that it would start to explore a dual listing of PYX's ordinary shares on the Standard Segment of the London Stock Exchange; this process continues and the Company looks forward to updating shareholders in due course.

Notably, the Company continues to be very successful in managing work-related accidents, with zero lost-time injuries in addition to having no reported COVID-19 incidents.

ir@pyxresources.com
Tel.: +61 2 8823 3132