Rey Resources Limited: Quarterly Cash Flow and Operational Update - September 2024
REY (REY) Share Update October 2024 Tuesday 29th
Rey Resources Reports Quarterly Cash Flow and Operational Update
Rey Resources Limited (ASX: REY) has released its quarterly cash flow report, detailing financial and operational activities for the period ending 30 September 2024.
Instant Summary:
- Net cash from financing activities: $999,000.
- Cash balance at quarter-end: $396,000.
- Available loan facilities: $7.55 million.
- Operational focus on oil and gas interests in Western Australia.
Financial Overview
Rey Resources Limited has reported a net cash inflow of $999,000 from financing activities during the quarter, primarily driven by proceeds from borrowings. The company ended the quarter with a cash balance of $396,000, reflecting a strategic approach to managing its financial resources.
Despite a net cash outflow of $690,000 from operating activities, Rey Resources has maintained a stable financial position, supported by available loan facilities totaling $7.55 million. This financial flexibility provides the company with the ability to continue its exploration and development activities in the Canning and Perth Basins.
Operational Highlights
Rey Resources is actively engaged in exploring its oil and gas interests, with a focus on the Fitzroy Blocks and Derby Block in Western Australia. During the quarter, the company conducted a technical review of EP458 and held discussions regarding exploration strategies for EP457. These efforts are aimed at identifying mature drilling targets and advancing exploration activities.
In addition, Rey Resources has entered into a Binding Cooperation Framework Agreement for the disposal of its subsidiary, Gulliver Productions Pty Ltd, which holds interests in the Lennard Shelf Blocks. The transaction, completed in October, generated a cash consideration of $400,000, enhancing the company's liquidity position.
Corporate Developments
Rey Resources has extended its on-market buyback program, allowing for the repurchase of up to 21.2 million shares over the next 12 months. This initiative reflects the company's commitment to enhancing shareholder value and optimizing its capital structure.
As part of its corporate governance, the company has disclosed payments of approximately $67,000 to related parties, including consulting and director fees. These payments are in line with the company's strategic objectives and operational requirements.
The positive cash flow from financing activities and the completion of asset disposals are expected to bolster Rey Resources' financial stability. However, the ongoing cash outflow from operations suggests the need for continued focus on cost management and revenue generation. The company's strategic initiatives in the oil and gas sector could lead to long-term growth opportunities, but investors should remain cautious of potential risks associated with exploration activities.
Investor Reaction:
Analysts may view the report positively due to the successful financing activities and asset disposal, which enhance liquidity. However, the continued operational cash outflow may raise concerns about the company's ability to achieve sustainable profitability. Investors will likely monitor Rey Resources' progress in advancing its exploration projects and managing its financial resources effectively.
Conclusion:
Rey Resources Limited's quarterly cash flow report highlights the company's strategic focus on strengthening its financial position and advancing its exploration activities. Investors should stay informed about the company's operational progress and financial performance, as these factors will be critical in determining future growth prospects.