Nextsource Stock Price, News & Analysis

NextSource Materials Inc. (TSX:NEXT)(OTCQB:NSRCF) has announced significant progress at its Molo Graphite Mine in Madagascar. The company has completed planned screening equipment upgrades, enabling the sorting of SuperFlake® graphite concentrate into specific size fractions to meet customer requirements. The mine is now consistently producing concentrate with 95-97% carbon content, meeting or exceeding recovery and grade expectations.

Additional process plant upgrades were implemented during the screen installation, which NextSource believes will enhance sustainable recoveries. The company has begun transporting saleable SuperFlake® concentrate to the Port of Tulear for export. CEO Craig Scherba expressed confidence in the company's ability to meet various customer specifications and in the resilience of their future production profile as they look towards Phase 2 expansion.

NextSource Materials has appointed Jaco Crouse as its new Chief Financial Officer (CFO), effective July 9, 2024. Crouse replaces Marc Johnson, who served as CFO since October 2015 and will continue with the company in a consulting role to ensure a smooth transition. Crouse brings over 20 years of experience in the natural resources sector, including roles at Amaroq Minerals, Metals Acquisition Corp, Detour Gold , Triple Flag Precious Metals, Barrick Gold , and Glencore. He is a qualified Chartered Accountant and Financial Risk Manager. This strategic move is part of NextSource's global growth plan.

NextSource Materials announced a global expansion strategy for its battery anode facilities (BAFs), including a promising economic study for a proposed BAF in Saudi Arabia. The study, conducted by Stantec, projects a facility with a 20,000 tonnes per annum (tpa) output of coated spheronized purified graphite (CSPG) for electric vehicle applications.

Key results include a post-tax NPV of $677 million, IRR of 20.3%, and annual revenues estimated at $230.1 million with an EBITDA of $128.5 million. The initial capital cost is pegged at $280 million plus $12 million working capital. Full production is achievable within 16 months from the start of construction.

The KSA BAF is part of a broader plan to establish multiple BAFs in regions like Madagascar, UAE, and North America, leveraging proprietary anode processing technology. Saudi Arabia offers significant incentives for the project, aligning with its Vision 2030 plan to diversify its economy and establish itself as a global battery materials hub.

NextSource Materials has signed a Mandate Letter with the International Finance (IFC) for a US$91 million debt facility. This facility will fund the expansion of the Molo Graphite Mine in Madagascar, increasing its production capacity from 17,000 tpa to 150,000 tpa of SuperFlake® graphite concentrate. A December 2023 Technical Feasibility Study estimated the expansion's capital cost at US$161.7 million plus US$25.2 million in working capital, yielding a pre-tax NPV8 of US$424.1 million and a pre-tax IRR of 31.1%. The IFC will lead in coordinating the debt syndicate with other financial institutions. Due diligence is expected to complete by Q1 2025.

NextSource Materials has announced significant changes to its top management team as part of its global growth strategy. Hanré Rossouw will join as President and CEO on November 1st, 2024, initially joining the Board as a Director from September 1st, 2024. Hanré brings extensive experience from his previous roles at Sasol and other major mining and investment companies.

Current President and CEO, Craig Scherba, will transition to the role of Chief Development Officer while continuing as a Director. Scherba's tenure saw the development of the Molo graphite deposit in Madagascar and establishing valuable downstream and customer relationships within the automotive OEM supply chain. The Board is enthusiastic about leveraging Rossouw's experience to expand mine output, enhance downstream options, and manage a growing capital base.