OM Holdings Secures US$168M Debt Facility, Meets Q1 Production Targets

Operational Performance and Production Outlook

OM Holdings Limited (ASX: OMH) has delivered a steady start to FY2025, with Q1 production volumes meeting company guidance. The manganese alloy and ferrosilicon (FeSi) production lines continue to operate effectively, supported by ongoing processing trials aimed at enhancing throughput and yield. Notably, the second ultra-fine processing (UFP) trial achieved a peak throughput of 280-290 tonnes per hour over 15 hours, with manganese grades and yield matching expectations. A third trial commenced in mid-April, targeting sustained nameplate feed rates for over 10 days, signaling a commitment to operational optimization.

Financial Strength Bolstered by Refinancing

In a strategic move to underpin its growth and operational stability, OM Holdings successfully completed refinancing arrangements, securing a US$168 million syndicated debt facility alongside US$136 million in working capital and bank guarantees. This refinancing provides the company with enhanced financial flexibility to support ongoing projects and navigate market fluctuations. The strengthened balance sheet positions OMH well to manage upcoming planned maintenance activities and potential market headwinds.

Environmental and Quality Recognition

OM Sarawak, a key operational hub for OM Holdings, received the Merit Award in the Large Enterprise category at the 11th Premier of Sarawak Environmental Award ceremony. Additionally, the facility was awarded ISO 9001:2015 certification for its quality management system, underscoring the company’s commitment to sustainable and high-standard operational practices. These accolades enhance OMH’s reputation in the metals and mining sector, particularly in regions prioritizing environmental stewardship.

Market Dynamics and Price Trends

The ferrosilicon market remains under pressure, primarily due to Chinese supply dynamics and competition from Russian producers. Prices have declined by approximately 8.5% year-on-year, with the 3-month average FeSi price at US$1,148 per tonne CIF Japan. The near-term outlook suggests continued price pressure amid macroeconomic uncertainties and production cuts by major Chinese producers.

Conversely, manganese ore and alloy prices are showing signs of stabilization and modest growth. The manganese ore index increased by 8.4% year-on-year, with high-grade ore prices rising significantly in recent quarters. This price resilience is supported by expectations of resumed operations from key global ore suppliers and reduced global utilization rates, contributing to a more balanced market environment.

Upcoming Operational Considerations

OM Holdings has scheduled major maintenance for two FeSi furnaces in April and June 2025, which will be critical to sustaining long-term production efficiency. The impact of these maintenance activities on short-term output will be closely watched by investors and analysts. Meanwhile, the company’s ongoing processing trials and production optimization efforts may offset some operational disruptions, maintaining overall production momentum.