Rey Resources Limited - Quarterly Cash Flow and Operational Update - June 2024
REY (REY) Share Update July 2024 Monday 29th
Rey Resources Reports Quarterly Cash Flow and Operational Update
Rey Resources Limited (ASX: REY) has published its quarterly cash flow report for the period ending June 30, 2024. The report details the company's financial performance, including cash flows from operating, investing, and financing activities, as well as updates on its ongoing projects.
Instant Summary:
- Net cash used in operating activities: $653,000 for the quarter.
- Net cash used in investing activities: $109,000 for the quarter.
- Net cash from financing activities: $894,000 for the quarter.
- Cash and cash equivalents at end of period: $269,000.
- Available loan facilities: $8.55 million.
Financial Overview
Rey Resources Limited reported a net cash outflow of $653,000 from operating activities for the quarter ending June 30, 2024. This includes payments for administration and corporate costs amounting to $125,000 and interest payments of $528,000.
In terms of investing activities, the company spent $109,000 on exploration and evaluation. There were no proceeds from the disposal of assets or investments during this period.
Financing Activities
The company raised $900,000 through borrowings and spent $6,000 on share buybacks, resulting in a net cash inflow of $894,000 from financing activities.
As of June 30, 2024, Rey Resources had cash and cash equivalents totaling $269,000. The company also has access to $8.55 million in unused loan facilities, providing a total available funding of $8.819 million, which is estimated to cover 11.57 quarters of operating expenses.
Project Updates
Rey Resources continues to focus on its oil and gas interests in the Canning and Perth Basins, Western Australia. The company holds interests in several key blocks, including EP457, EP458, and EP487. During the quarter, Rey lodged an Environmental Plan for the committed 3D seismic survey in the Derby Block (EP487) and completed the vintage seismic reprocessing for EP104.
Rey is also working on the West Kora-1 workover and Point Torment-1 side track drilling projects, actively discussing with potential rig operators.
Corporate Developments
On June 17, 2024, Rey Resources announced an extension of the maturity dates for its loan facilities with ASF Group Ltd and Ms. Wanyan Liu to April 30, 2026. Ms. Liu also increased her loan facility by $5 million, bringing the total to $25 million.
The company paid approximately $72,000 to related parties during the quarter, including $33,000 in consulting fees and $39,000 in director fees.
The quarterly cash flow report indicates that Rey Resources is managing its cash flow effectively, with sufficient funding available for future operations. However, the net cash outflow from operating activities and the ongoing need for external financing could raise concerns among investors. The company's focus on extending loan facilities and securing additional funding is a positive step, but the reliance on borrowings may impact investor sentiment.
Investor Reaction:
Analysts have noted the company's proactive approach in securing additional funding and extending loan maturities. Investor reactions have been mixed, with some expressing concerns over the company's reliance on borrowings, while others are optimistic about the potential of Rey's ongoing projects in the Canning and Perth Basins.
Conclusion:
Investors should closely monitor Rey Resources' financial performance and project developments in the coming quarters. The company's ability to manage its cash flow and secure additional funding will be crucial in maintaining investor confidence. Staying informed on Rey Resources' strategic initiatives and operational progress will help investors make well-informed decisions.