ZincOx operating loss widens amid viability concerns

ZincOx Resources announced its unaudited half yearly results for the six months to 30 June on Wednesday, with revenue of $0.64m more than doubling from the $0.29m in the 2015 interim period.

The AIM-traded firm’s operating expenses were almost three times what they were in the prior comparative period, however, at $5.03m against $1.88m, making for an operating loss for the six months of $4.94m, compared to $1.91m.

On an underlying basis, its EBITDA loss was $0.74m however, compared with $2.12m.

The company’s continued viability was in question, however, as it remained a cash shell under AIM Rule 15 following the reduction of its interest in its primary asset, the Korean Recycling Plant.

“The directors have taken steps to reduce the running costs of the company to the minimum level consistent with the proper running of a public company, with the objective of extending, as far as possible the cash resources of the company and so the period during which the company can identify a new project or raise funds from the disposal of the group's other main assets,” the firm’s board said in a statement.

“In spite of this the directors believe that, in the absence of the sale of one or more of the group's main assets or the raising of additional capital by way of issuing new shares, the group will neither have sufficient funding to continue as a going concern nor to continue in operational existence for the twelve months from the date of this report.”

In the absence of a reverse takeover, ZincOx’s shares will be suspended from trading from 0730 GMT on 31 October 2016.

At 1154 BST, shares in the firm were down 20.2% at 0.4p.