SHARES in Kenmare Resources fell in Dublin and London yesterday after the company warned that full-year production of ilmenite and zircon may be lower than previously expected after power disruptions in Mozambique hit mining operations.
Kenmare shares declined as much as 10.1pc in Dublin at one stage and closed down 7.3pc at 38.4 cent.
In London, the shares suffered the second biggest drop on the FTSE 350 index of UK stocks after it warned that it will probably miss its previous estimates of 630,000 metric tonnes of ilmenite production and 50,000 tonnes of zircon by as much as 10pc. The company also noted that prices were moving lower.
"The statement this morning would lead us to reduce our ilmenite forecast more," Gerry Hennigan, an analyst in Dublin at Goodbody Stockbrokers, said in a note.
"That, along with a history of operational shortcomings, will undoubtedly weigh on the share price this morning."
Power disruptions in Mozambique curbed output in the third and fourth quarters, Kenmare said.
Adjustments to a dredge pond also hurt output. Ilmenite, which makes up 70pc of Kenmare's forecast sales this year, suffered from weaker prices, while the declines in rates for zircon were greater.
Ilmenite is used in paint pigment and zircon in chemical processing equipment.
Kenmare has a history of disappointing investors. Floods from an artificial lake at the mine halted production last year, swept away a village and left a child dead.
Kenmare said over the summer that first-half profit rose as higher market prices boosted revenue.
The company reported a pre-tax profit of $38.8m (€30m) for the six months ended June 30 compared with a pre-tax loss of $14.2m a year earlier.
The company produced 276,600 tonnes of ilmenite and 23,600 tonnes of zircon for the first half.
Kenmare said revenue for the period rose 95pc to $109m.
The company's shares have fallen 29pc this year amid concerns about prices, giving Kenmare a market value just shy of €972m.